1.    The Mortgage Default.  – The Borrower is unable or unwilling to make the required mortgage payments to the lender.  This creates a default on the promissory note.

2.    N.E.D. (Notice of Election and Demand) – After the default the lender will start the foreclosure process by filing the N.E.D. with the county’s Public Trustee.  The Trustee will schedule the foreclosure sale date anywhere from 110 days to 125 days from recording of N.E.D.

3.    Rule 120 Hearing.  – Sometime after the N.E.D. and before the sale date the lender must go to court in a "Rule 120" hearing to show that there is a default among other things.  If borrower does not file a response to this Rule 120 hearing, the order for sale is granted without a hearing at all.  

4.    The borrowers “Intent to Cure” – 15 days prior to the sell date the borrower may file “Intent to Cure” with the Public Trustee.  The borrower must bring all payments and fees current with the lender.

5.    The Sale – The property is sold to the highest bidder.  Lean holders will have the first crack at the biding process and any third party bidder must bid higher than the previous lean holders.

6.    R.E.O. (Real Estate Owned) – Upon a successful bid the lender will list the property with a local REALTOR for sale.  It is at this point you can place an offer.

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