Meaning & Definition of word "Foreclosure"

Foreclosure

/fɔːrˈkloʊʒər/

1. The legal process by which a lender takes possession of a property when the borrower fails to keep up with mortgage payments.
- Example: The bank initiated foreclosure proceedings after the homeowner missed several mortgage payments.
2. The act of closing or ending a financial obligation or a loan agreement, especially in real estate.
- Example: Many families went through foreclosure during the housing crisis.
3. The state of having a property taken due to failure to repay a mortgage.
- Example: After the foreclosure, the property was auctioned off to the highest bidder.

Early 19th century, from the term 'foreclose', which means to shut out or preclude.

foreclosure sale:

A public auction of property that has been foreclosed.

pre-foreclosure:

The stage before a property is officially foreclosed, often involving possible short sales.

bank foreclosure:

A foreclosure initiated by a bank or lender.

mortgage:

A loan used to purchase property, typically secured by that property.

loan:

A sum of money borrowed, typically with the expectation of being paid back with interest.

repossession:

The act of taking back property from the borrower due to default.

Meaning: The bank taking your house.

Example Sentence: After three missed payments, I got the dreaded news that the bank was taking my house.

Meaning: House auction.

Example Sentence: They're having a foreclosure auction next week—great deals to be had!