When a home is in foreclosure the mortgage lender exercises his ability to enforce payment on a loan and sells the borrower's home to pay the default loan amount, according to SFGate. A borrower risks foreclosure if he stops making payments or misses a certain number of payments.
The first step of the foreclosure process is for the lender to send the borrower a notice of default to inform him of how much he needs to pay to get out of default, notes SFGate. A trustee has to be named to complete the foreclosure process and answer any questions the borrower has. Trustees are often title companies, attorneys, mortgage companies and bank departments.
Once a borrower receives a notice of default, he has 90 days to redeem his mortgage, states SFGate. Redeeming a mortgage means the borrower agrees to pay the defaulted loan amount in addition to any late fees, principal, interest and lender costs. If the borrower decides not to redeem his mortgage, the trustee is legally allowed to sell the home through an auction. The borrower must receive a notice of the auction at least 20 days before it occurs. Once the home has been sold, the lender is able to evict the borrower from the home if he doesn't leave voluntarily.