'Foreclosure' is a legal process that permits a creditor (a lender or mortgage holder) to repossess or sell real property, like a condo, a home, or land, for the purpose of repaying the debt owed on that property. Mortgage holders are permitted to foreclose on property anytime after the borrower defaults on the mortgage, unless otherwise set out in the mortgage or in the laws of the state where the property is located. Although state laws vary, foreclosure generally involves the following steps:
� The mortgage holder gives the defaulting property owner a written notice of default.
� The property owner is given a limited period of time in which to cure the default and pay all amounts due, including interest, penalties, attorney charges, and any other fees imposed by the law or the mortgage.
� The lender may pursue judicial foreclosure (which involves filing a lawsuit in a court) or non-judicial foreclosure, depending upon the laws of the state where the property is located.
� Mortgage holders usually give property owners the opportunity to cure the default. Once the time allowed to cure the default passes, the mortgage holder usually gives notice of a foreclosure sale.
� The property may be sold at public auction where the highest bidder can purchase the property, or the lender may purchase the property and sell it later in a private sale.
� An unlawful detainer suit is filed to evict the property owner if he or she is still living on the property.