The in-court foreclosure process, although rarely used, begins when the lender files a court document starting the foreclosure process. A court order can be issued which specifies the terms and conditions of the sale. After the court declares a foreclosure, the property will be auctioned, according to the terms set by the court.
The more common foreclosure process is used when the mortgage or deed of trust allows the lender to sell the property without going through the courts. The lender initiates this type of foreclosure by scheduling a foreclosure sale. Before doing this, the lender sends a notice of default to the borrower, giving them 30 days to pay off the default and prevent foreclosure.
Did You Know?
A Short Sale Can Stop Foreclosure