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 Wisconsin, foreclosure is a judicial process, meaning that the lender must go through the courts to terminate a homeowner's interest in their property due to default on mortgage payments. When a homeowner fails to make payments as agreed in the promissory note, the lender can initiate foreclosure proceedings. The process begins with the lender filing a lawsuit against the borrower. If the court finds in favor of the lender, it will issue a judgment of foreclosure and order the sale of the property. The property is then typically sold at a sheriff's sale, which is a public auction. The proceeds from the sale are used to pay off the mortgage debt. If the sale does not cover the full amount of the debt, the lender may obtain a deficiency judgment against the borrower for the remaining amount. Wisconsin law provides certain rights to homeowners, including the right to redeem the property by paying off the full amount of the debt before the sale, and in some cases, after the sale. It is important for homeowners facing foreclosure in Wisconsin to consult with an attorney to understand their rights and options.