How does the Foreclosure process work?

The foreclosure process as applied to residential mortgage loans is a bank or other secured creditor selling or repossessing a parcel of real property (immovable property) after the owner has failed to comply with an agreement between the lender and borrower called a "mortgage" or "deed of trust". Commonly, the violation of the mortgage is a default in payment of a promissory note, secured by a lien on the property. When the process is complete, the lender can sell the property and keep the proceeds to pay off its mortgage and any legal costs. If no buyer can be found the properties goes through an Auction.

Bank owned foreclosures, also known as REO (real estate owned) properties, are homes that have gone through foreclosure and have been bought back by the bank to cover at least a part of the loss from the mortgage. As the banks don’t want to keep these properties they try to sell them again quickly.