Foreclosure is a legal process that allows lenders like banks and mortgage brokers to recover the amount owed on a defaulted loan by taking ownership of and selling the property. In this video, you'll learn a simple way to understand this concept through an easy and brief explanation. Default typically occurs when a borrower misses a specific number of payments. Lenders often work with borrowers to help them catch up on payments and avoid foreclosure. If a property doesn’t sell at a foreclosure auction, or if it skips the auction, lenders typically take ownership of the property.