foreclosure
for-KLOH-zher
/fɔːrˈkloʊʒər/
The action of taking possession of a mortgaged property when the mortgagor fails to keep up their mortgage payments.
A legal process by which a lender (mortgagee) repossesses a property from a borrower (mortgagor) who has defaulted on their mortgage payments. It results in the loss of the property for the borrower.
The story behind the word. The word 'foreclosure' comes from the Old French 'forclore,' meaning 'to shut out, exclude.' This is a combination of 'for-' (meaning 'out' or 'away') and 'clore' (from Latin 'claudere,' meaning 'to close'). So, 'foreclosure' literally means 'to shut out' the borrower from their property, closing off their rights due to non-payment.
Word relationships
- repossession: Broader term for taking back any property due to non-payment; 'foreclosure' is specific to mortgaged real estate.
- seizure: The act of taking something by force or legal authority.
- redemption: The act of regaining possession of property by paying off the debt.
Commonly confused with
- eviction: 'Foreclosure' is when a lender takes back mortgaged property; 'eviction' is when a landlord removes a tenant from rented property.
Word family
- foreclose (verb): To take possession of a mortgaged property as a result of the mortgagor's failure to keep up mortgage payments.
Collocations
- face foreclosure
- avoid foreclosure
- foreclosure crisis
- foreclosure proceedings
- foreclosure auction
Example sentences
- "The family fought desperately to avoid foreclosure on their home after the primary earner lost his job." A family facing economic hardship.
- "The bank initiated foreclosure proceedings after the homeowner missed six consecutive mortgage payments." A bank's legal department.
- "An increase in foreclosures often indicates a struggling housing market and broader economic distress." From a real estate market analysis.
Memory hook
When a bank 'forecloses,' they 'close' the 'door' on your ownership. Close the door
When not to use
Do not use 'foreclosure' for the repossession of items other than mortgaged property (e.g., a car). For other items, 'repossession' is the more general term.
Fun facts
- The Great Recession of 2008 was largely triggered by a subprime mortgage crisis, leading to a massive wave of foreclosures across the United States.
Related words
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