finance
judicial foreclosure
Judicial foreclosure is a foreclosure process carried out through the courts. The lender files a lawsuit, the borrower can respond, and if the court finds the borrower in default, it orders the property sold, often at a public auction run by a sheriff or court officer. It is common with mortgages and is required in some states. It tends to take longer than nonjudicial foreclosure and may allow a deficiency judgment.
- Exam tip
- Judicial foreclosure goes through court and is tied to mortgages; nonjudicial foreclosure uses a power-of-sale clause, usually with deeds of trust. Which method is used varies by state.
- Example
- A borrower stops paying, the bank sues, the court enters a foreclosure judgment, and the sheriff auctions the home months later, issuing a sheriff's deed.
Related terms & state variants
Sources
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Last verified: 2026-10-23