Foreclosure is the legal process effected through the court system in which a mortgagee (lender—often a bank) terminates a mortgagor’s (borrower’s) interest in the real property in which the mortgagor gave the mortgagee a security interest (a lien) as collateral for the loan used to purchase the property.

Foreclosure generally occurs when a homeowner defaults and fails to make mortgage payments as required by the loan agreement (promissory note).

Foreclosure allows the lender to seize the property, remove the homeowner, and sell the home—all of which are legal remedies the mortgagor and mortgagee agreed to in the mortgage contract.

In Delaware, foreclosure is a legal process that allows a lender to terminate a borrower's interest in a property due to the borrower's failure to make the required mortgage payments as stipulated in the loan agreement. This process is conducted through the state's court system, known as a judicial foreclosure. When a homeowner defaults on their mortgage, the lender may file a lawsuit to obtain a court order to foreclose on the property. If the court grants the foreclosure, the property can be seized, the homeowner can be evicted, and the property may be sold at a public auction. The proceeds from the sale are used to pay off the mortgage debt, with any surplus returned to the borrower. If the sale does not cover the full amount of the debt, the lender may be able to obtain a deficiency judgment against the borrower for the remaining amount. Delaware law also requires that homeowners be given notice of the foreclosure proceedings and may provide certain rights to the homeowner, such as the right to reinstate the loan or redeem the property before the sale.