Each state has its variation on the foreclosure process. Two of which are the more common ones:

A.  Judicial Foreclosure: (Time Period – 10 to 11 months)

1. Homeowner defaults on payments for three consecutive months.

2. Lender retains services of an attorney. 

3. The legal firm will file a Notice of Default (NOD) in the county court.

4. A notice of default will be published for four consecutive weeks for public information.

5. At the end of four weeks, the house will be auctioned off to the highest bidder at the steps of county court house. 

6. The homeowners are given six months to bring their account current and pay off lender. 

7. If the homeowner succeeds in refinancing or selling the house or somehow raises the enough cash to pay the mortgage off, they will still have the chance to save the house in this six-month window of time. 

8. After six months and they are not able to raise enough money to pay the lender, the courthouse sheriff will come to the house and evicts the residents and change the locks.

9. The house will now be officially foreclosed and belongs to the bank or the investor who purchased the house during the courthouse auction.

B. Non-Judicial Foreclosure: (Time Period – 4 to 5 months)

1. Homeowner fails to make payments for three consecutive months. 

2. Lender will transfer the matter to a lawyer. 

3. The lawyer will file a Notice of Default (NOD) in the county clerk office.

4. A notice of default will be published for four consecutive weeks for public information. 

5. At the end of four weeks, the house will be auctioned off to the highest bidder at the steps of county court house. 

6. The eviction process happens within 3-4 days after the auction and the property will be transferred back to the lender or the investor who bought the house at auction. 

Foreclosure Profit Opportunities

 There are three phases to a foreclosure opportunity: Before the trustee's sale, at the trustee's sale, or after the trustee's sale.

Before The Sale -Time between when the homeowner has stopped making mortgage payments and when the properly is actually put up for sale at auction. Investors take this opportunity to deal directly with the homeowner.

At The Sale - When the courts seized the property from the homeowner and sell it to the highest bidder. The county sheriff or a trustee handles this process, depending on the state

After The Sale - If the property fails to sell at auction, or if the lender ends up as the highest bidder, the home becomes REO, or "real estate owned" by the bank. Banks then try to sell these REO properties on the open market, often through a real estate agent or third-party marketing company.