closing
power of sale
A power of sale is a clause in a deed of trust or mortgage that authorizes the trustee or lender to sell the property without going to court if the borrower defaults. After giving notice required by state law, the trustee holds a public sale and uses the proceeds to pay the debt. This nonjudicial foreclosure is generally faster and less costly than judicial foreclosure. Availability and procedures vary by state.
- Exam tip
- Power of sale = nonjudicial foreclosure, commonly with deeds of trust. The buyer at the sale usually receives a trustee's deed.
- Example
- A borrower defaults on a deed of trust; after the required notice period the trustee auctions the home and delivers a trustee's deed to the high bidder.
Related terms & state variants
Sources
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Last verified: 2026-10-23