Foreclosures
Foreclosure is the legal process by which a lender reclaims a property from a borrower who has defaulted on their mortgage. When a borrower stops making their mortgage payments, the lender can initiate foreclosure proceedings to take ownership of the property and sell it to recover the unpaid loan balance. Continue Reading Below
Encyclopedia Articles
Discover the definition of financial terms related to foreclosures.
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Learn About Foreclosures
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9 Steps to Reduce the Threat of Foreclosure
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How to Finance Flipping a House
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Risks of a Home Equity Loan: What Borrowers Should Watch Out For
Andrew Latham
Risks of Using Home Equity for Business Debt: What You’re Really Putting at Risk
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How Does a Mortgage Affect Your Credit Score?
Camilla Smoot
VA Loan After Bankruptcy or Foreclosure 2026: How to Qualify and Rebuild
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How to Repay a Reverse Mortgage and Exit Without Losing Your Home
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How to Pay Off or Get Out of a Reverse Mortgage
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Mortgage for Surviving Spouses and Heirs: What You Need to Know
Andrew Latham
About Foreclosures
- The lender files a lawsuit against the borrower to establish their right to foreclose on the property.
- The court holds a hearing to determine whether the borrower is in default and whether the lender has the right to foreclose.
- If the court rules in the lender's favor, it issues a foreclosure judgment, which allows the lender to proceed with selling the property.
- The property is sold at a public auction, with the proceeds from the sale used to pay off the borrower's mortgage debt. Any remaining balance may be owed to the borrower.