The Foreclosure Process

Foreclosure is the legal process a lender initiates to force the sale of a mortgaged property when the borrower has not met the terms of the loan agreement. Foreclosure technically begins either by the filing of a complaint for foreclosure in court or by the recording of a Notice of Default in the county land records. Foreclosures can also be initiated by other entities that have a lien on a property, such as the county, if property taxes are not paid.

Types of Foreclosure

There are two types of foreclosure processes in Oregon:

• In a judicial foreclosure, the lender files a lawsuit asking a court to order the sale of your property. The proceeds of the sale are applied to your loan. In some cases, the court may grant the lender a judgment against you for the remaining balance of the loan. If your lender files a judicial foreclosure, you will be served with a summons and complaint that requires you to file an answer in court within 30 days. If you fail to respond in time, you may lose your right to contest the foreclosure. After the court enters judgment, the sheriff will sell the property at public auction. Homeowners facing judicial foreclosure should immediately seek legal advice from an attorney.
• In a non-judicial foreclosure, a trustee conducts a sale of the property without court oversight and according to state law. The trustee must record a Notice of Default and serve you with a Notice of Sale 120 days before the sale date. You have until 5 days before the sale to bring the loan current.

If you have any questions about the types of foreclosure, talk to a foreclosure prevention counselor or an attorney.

Foreclosure: You Can Avoid It

This pamphlet, prepared by the Oregon Department of Consumer & Business Services, offers helpful tips on how to avoid foreclosure. For the English version, please click here.

Types of Notices

Non-judicial foreclosure proceedings begin with the recording of a Notice of Default (NOD). Immediately after filing the NOD, the trustee will serve the homeowner with a Notice of Sale.

If your lender files a judicial foreclosure, you should receive a Summons and Complaint informing you that you must file an answer in court within 30 days.

Related Laws

The Oregon Legislature recently passed laws to help homeowners facing foreclosure in Oregon. Click here for more on those laws and the statutes that cover mortgage lending.

More Information

The Oregon State Sheriffs’ Association (OSSA) maintains a website for Legal Notices for Sheriff’s Sales of real property. The goal of the website is to increase public awareness of sheriffs’ sales, resulting in more bidders and fairer bids, and benefiting both creditors and debtors. This website provides visitors access to actual foreclosure notices currently scheduled to occur throughout Oregon.

In addition, a resources list on taxes, loan programs, mechanic's liens, mortgage payments rights, and filing a complaint against a lender can be found here.