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Non-Judicial Foreclosure
A foreclosure conducted without court action, using a power-of-sale clause in a deed of trust to authorize a trustee's public sale.
In depth
Non-judicial foreclosure relies on the power-of-sale clause embedded in deeds of trust. After default and a notice period, the trustee schedules and conducts a public auction, transferring title to the highest bidder via a trustee's deed. Misconception: non-judicial foreclosure is not lawless; it follows strict statutory procedures with notice requirements that vary by state. Practically, non-judicial foreclosure is faster and cheaper than judicial, often closing in 90 to 180 days. Title theory and intermediate states like California, Texas, Virginia, and Georgia favor it. Seller financiers using AITDs or purchase money deeds of trust benefit from this efficiency. Borrowers retain limited rights, including reinstatement and in some states post-sale redemption. Always retain a qualified trustee and follow statutory notice requirements precisely.
Educational content only. Definitions reflect typical usage in US owner-finance and FSBO transactions; statutes and case law vary by state. Consult a licensed real-estate attorney for fact-specific guidance.