real estate

Foreclosure

In the event that the mortgage note or other stipulations outlined in the mortgage contract are not paid as agreed upon, a foreclosure is the legal process that results in the property that was used as security for the loan being auctioned in order to settle the obligation. The process of foreclosure brings an end to the rights of all parties involved and transfers the title in the mortgaged property either to the holder of the mortgage or to a third party who may purchase the realty at the foreclosure sale. This transfer clears the property of any encumbrances that have been placed on the property after the mortgage was placed on it.