Non-judicial (the party enforcing the foreclosure follows a series of out-of-court and state-specific procedural steps to foreclose the mortgage). The most common method of foreclosure in Iowa is called “foreclosure without repayment.” Most states require mortgagees to sell foreclosed properties at a public auction. If the property is not sold at auction, the mortgagee keeps it and then resells it in a normal real estate sale. State laws vary with respect to what happens if a mortgage property is sold for less than the mortgagor's outstanding debt.
In some states, mortgage creditors are responsible for the difference. In all states, if the property is sold for more than the mortgagor's outstanding debt, the mortgagee gets the difference. Judicial foreclosure is a costly and time-consuming foreclosure method by which mortgaged property is sold through a court proceeding. Judicial foreclosure requires many standard legal steps, such as filing a complaint, notification of the process, notification and a hearing.
Judicial foreclosure is available in all jurisdictions and is the exclusive or most common method of foreclosure in at least 20 states.
