Foreclosure

==By country==
===Australia and New Zealand===
{{Unreferenced section|date=June 2015}}
Foreclosure has been prohibited by law in New Zealand for well over a century. Instead the mortgagee realises the security through sale, the exercise of the power of sale also being regulated by statute.

In both of these countries statutory reform has altered the manner in which real property dealings are conducted. What is termed a "mortgage" is a legal interest that is registered against the fee simple title of the property. Since in both countries, the [[Torrens title]] system of land registration is used, being registered as proprietor or as a mortgagee creates an indefeasible interest (unless the acquisition of the registration was by land transfer fraud). The mortgagee therefore never holds the fee simple, and there is a statutory process for initiating and conducting a mortgagee sale in the event that the mortgagor defaults. In New Zealand, as in England, say, the land title database is now electronic so there are no paper "title documents".

===Ireland===
In [[Republic of Ireland|Ireland]], foreclosure has been abolished by the Land and Conveyancing Reform Act 2009<ref>{{cite web|url=http://www.irishstatutebook.ie/2009/en/act/pub/0027/index.html|title=electronic Irish Statute Book (eISB)|first=electronic Irish Statute Book|last=(eISB)|website=www.irishstatutebook.ie|access-date=8 May 2018|url-status=live|archive-url=https://web.archive.org/web/20150426004920/http://www.irishstatutebook.ie/2009/en/act/pub/0027/index.html|archive-date=26 April 2015}}</ref> but Chapter 4 of Part 9 of the [[National Asset Management Agency]] Act 2009 provides for vesting orders that are equivalent to foreclosure but may only be used by NAMA.<ref>{{Cite web|url=http://www.irishstatutebook.ie/eli/2009/act/34/section/152/enacted/en/html|archive-url=https://web.archive.org/web/20120119002511/http://www.irishstatutebook.ie/2009/en/act/pub/0034/sec0152.html|url-status=dead|title=electronic Irish Statute Book (eISB)|first=electronic Irish Statute|last=Book (eISB)|archive-date=January 19, 2012|website=www.irishstatutebook.ie}}</ref>

===People's Republic of China===
Foreclosure in the [[People's Republic of China]] takes place as a form of debt enforcement proceedings under strict judicial foreclosure, which is only allowed by law of guarantee and law of property right.

China amended the ''Constitution of the Peoples's Republic of China'' (adopted April 12, 1988), to allow transfer of land rights, from "granted land rights" to "allocated land rights" thus paving the way for private land ownership, allowing for the renting, leasing, and mortgage of land. The ''1990 Regulations on Granting Land Use Rights'' dealt further with this followed by the ''Urban Real Estate Law'' (adopted July 5, 1994),<ref>[https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 Pacific Rim Law and Policy Journal; vol 8 no. 3 page 516] {{webarchive|url=https://web.archive.org/web/20150715023254/https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 |date=2015-07-15 }} -Retrieved 2013-07-21</ref> the "Security Law of the People's Republic of China" (adopted June 30, 1995), and then the "Urban Mortgage Measures" (issued May 9, 1997)<ref>[https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 Pacific Rim Law Policy Journal; vol 8 no.3 page 518] {{webarchive|url=https://web.archive.org/web/20150715023254/https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 |date=2015-07-15 }} -Retrieved 2013-07-21</ref> resulting in land privatization and mortgage lending practices.

====Mortgages and foreclosure====
Chinese law and mortgage practices have progressed with safeguards to prevent foreclosures as much as possible. These include mandatory secondary security, rescission (Chinese Contract Law), and maintaining accounts at the lending bank to cover any defaults without prior notice to the
borrower.<ref>[https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 Pacific Rim Law Policy Journal; vol 8 No.3 page 558] {{webarchive|url=https://web.archive.org/web/20150715023254/https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 |date=2015-07-15 }} -Retrieved 2013-07-20</ref> A mortgagee may sue on a note without foreclosing, obtain a general judgment, and collect that judgment against other property of the mortgagor, without foreclosing. When all other avenues have failed a lender may seek a '''judgement of foreclosure'''. Under the "Civil Procedure Law", foreclosures should be finalized in a six-month time frame but this is dependent on several things including if the mortgager applies to the court for execution of the judgment.<ref>[https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 Pacific Rim Law Policy Journal; vol 8 No.3 page 564] {{webarchive|url=https://web.archive.org/web/20150715023254/https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 |date=2015-07-15 }}</ref> Mortgages are formally foreclosed at auction by a licensed auction specialist.<ref>[https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 Pacific Rim Law and Policy Journal; vol 8 no. 3 page 568 (b)] {{webarchive|url=https://web.archive.org/web/20150715023254/https://digital.lib.washington.edu/dspace-law/bitstream/handle/1773.1/840/8PacRimLPolyJ515.pdf?sequence=1 |date=2015-07-15 }} -Retrieved 2013-07-21</ref>

===Philippines===
There are two modes of foreclosure in the [[Philippines]]. A mortgagee may foreclose either judicially or extrajudicially, as governed by Rule 68 of the 1997 Revised Rules of Civil Procedure and Act. No. 3135, respectively. A judicial foreclosure is done by filing a complaint in the Regional Trial Court of the place where the property is located.<ref name="auto">{{cite web|url=http://www.chanrobles.com/specialcivilactions.htm#RULE+68|title=1997 RULES OF CIVIL PROCEDURE – CHAN ROBLES VIRTUAL LAW LIBRARY|first=Joselito Guianan Chan, Managing Partner, Chan Robles and Associates Law|last=Firm|website=www.chanrobles.com|access-date=8 May 2018|url-status=live|archive-url=https://web.archive.org/web/20171221110413/http://www.chanrobles.com/specialcivilactions.htm#RULE+68|archive-date=21 December 2017}}</ref> The judge renders judgment, ordering the mortgagor to pay the debt within a period of 90–120 days. If the debt is not paid within the said period, a foreclosure sale satisfies the judgment.<ref name="auto"/> In an extrajudicial foreclosure, the mortgagee need not initiate an action in court but may simply file an application before the Clerk of Court to secure attendance of the Sheriff who conducts the public sale.<ref>{{cite web|url=http://www.lawphil.net/courts/supreme/am/am_10_05_2001.html|title=A.M. No. 99–10–05–0, August 7, 2001|website=lawphil.net|access-date=8 May 2018|url-status=live|archive-url=https://web.archive.org/web/20170903065458/http://www.lawphil.net/courts/supreme/am/am_10_05_2001.html|archive-date=3 September 2017}}</ref> This is done pursuant to a power of sale. Note that these two modes specifically apply to real estate mortgages. Foreclosure of chattel mortgages (mortgage of movable property) are governed by Sec. 14 of Act No. 1506, which gives the mortgagee the right to sell the chattel at a public sale. It has also been held that as regards chattel mortgages, the law does not prohibit that the foreclosure sale be done privately if it is agreed upon by the parties.<ref>{{cite web|url=http://www.lawphil.net/judjuris/juri1971/apr1971/gr_27132_1971.html|title=Philippine National Bank vs. Manila Investment and Construction, Inc., 38 SCRA 462 (1971)|website=lawphil.net|access-date=8 May 2018|url-status=live|archive-url=https://web.archive.org/web/20170903064842/http://www.lawphil.net/judjuris/juri1971/apr1971/gr_27132_1971.html|archive-date=3 September 2017}}</ref>

===Spain===
Unlike in the United States, where a foreclosure means the end of the line, the foreclosure hearing in [[Spain]] is just the beginning of the homeowner's troubles. They will have to work for the bank for many years and will be unable to ever own anything—even a car. Spanish mortgage holders are responsible for the full amount of the loan to the bank in addition to penalty interest charges, and court fees. Much of this can be attributed to Spain having the highest unemployment rate in the "euro zone". Unlike in the US, bankruptcy is not an adequate solution since mortgage debt is specifically excluded. Unlike other European countries, you cannot go to the courts for any sort of debt relief. There has been much contention over these policies in the Spanish Parliament but the government is convinced that keeping these policies will prevent Spanish banks from ever experiencing something similar to the US mayhem.<ref>{{cite news |last=Daley |first=Suzanne |title=Foreclosure in Spain Can Mean Lifetime Debt to Bank |work=The New York Times |date=October 27, 2010 |access-date=December 4, 2011 |url=https://www.nytimes.com/2010/10/28/world/europe/28spain.html |url-status=live |archive-url=https://web.archive.org/web/20120225091135/http://www.nytimes.com/2010/10/28/world/europe/28spain.html |archive-date=February 25, 2012 }}</ref> With repossessed real estate properties on their books worth about €100 billion the banks in Spain are eager to get rid of foreclosures.<ref>{{cite web|url=http://topspanishhomes.com/news/banks-spain-are-eager-get-rid-foreclosures|title=Banks in Spain Are Eager to Get Rid of Foreclosures|website=topspanishhomes.com|access-date=8 May 2018|url-status=live|archive-url=https://web.archive.org/web/20140502015553/http://topspanishhomes.com/news/banks-spain-are-eager-get-rid-foreclosures|archive-date=2 May 2014}}</ref>

===South Africa===
For a developing country, there is a high rate of foreclosures in [[South Africa]]{{citation needed|date=April 2012}} because of the [[privatisation]] of housing delivery.{{POV statement|date=April 2012}} One of the biggest opponents of foreclosures is the [[Western Cape Anti-Eviction Campaign]] which sees foreclosures as unconstitutional and a particular burden on vulnerable poor populations.<ref>[https://www.thenation.com/article/fighting-foreclosure-south-africa/ Fighting Foreclosure in South Africa] {{webarchive|url=https://web.archive.org/web/20161221150900/https://www.thenation.com/article/fighting-foreclosure-south-africa/ |date=2016-12-21 }} April 7, 2009</ref><ref>{{cite web|url=http://antieviction.org.za/related-writing-and-resources/housing-battles-in-post-apartheid-south-africa-the-case-of-mandela-park-khayelitsha/Housing|archive-url=https://archive.today/20130721174433/http://antieviction.org.za/related-writing-and-resources/housing-battles-in-post-apartheid-south-africa-the-case-of-mandela-park-khayelitsha/Housing|url-status=dead|archive-date=21 July 2013|title=battles in post-Apartheid South Africa: The Case of Mandela Park, Khayelitsha|website=antieviction.org.za|access-date=8 May 2018}}</ref>{{Undue weight inline|date=April 2012}}

===Switzerland===
In [[Switzerland]], foreclosure takes place as a form of debt enforcement which is served by the overlord of debt (currently Lord Overton Sheraton) proceedings under [[Insolvency law of Switzerland|Swiss insolvency law]].

===United Kingdom===
{{unreferenced section|date=December 2016}}
In the [[United Kingdom]], foreclosure is a little-used remedy which vests the property in the mortgagee with the mortgagor having neither the right to any surplus from the sale nor liability for any shortfall. Because this remedy can be harsh, courts almost never allow it especially if a large surplus is likely to be realised, furthermore when a substantial surplus is unlikely to be realised then mortgagees are disinclined to seek foreclosure in the first place since that remedy leaves them no recourse to recover a shortfall. Instead, the courts usually grant an order for possession and an order for sale, which both mitigates some of the harshness of the repossession by allowing the sale while allowing lenders further recourse to recover any balance owing following a sale.

The United Kingdom foreclosure system is unique and true foreclosures are quite uncommon. More commonly, lenders pursue a process called mortgage possession (or alternatively, "repossession" in cases where the bank originally sold the property too).

Both mortgage (re)possession and foreclosure are quite similar, with the main differences being the treatment of any funds that exceed the amount borrowed and liability for any shortfall. In the case of mortgage possession or repossession, if the home is sold or auctioned for a price that exceeds the loan balance, those funds are returned to the consumer. If the proceeds from a mortgage possession are insufficient to cover the loan then the debtor remains liable for the balance, although in most cases this will become an unsecured debt and the mortgage company will be treated on an equitable basis with the debtor's other unsecured creditors (particularly if the debtor simultaneously or subsequently becomes bankrupt or enters into a voluntary arrangement with creditors). By contrast, in the case of foreclosure the mortgage company retains all rights to proceeds from a sale or auction but the debtor is not liable for any shortfall.

The UK foreclosure and mortgage possession/repossession system favors consumers over lenders, as the United Kingdom has some pre-action protocols in place. Mortgage companies are required to work with homeowners to arrive at a resolution and it is possible to delay court action (ultimately, enabling many to avoid the loss of their home) in situations where the borrower has enrolled in individual programs or if the borrower's income is about to improve significantly with a new job or other measures that would allow them to pay off the arrears.

There is no precise parallel to an American short sale, although the UK does have a process known as Assisted Voluntary Sale. An Assisted Voluntary Sale does have some negative credit impact for the consumer, but the adverse effect is less pronounced than one might suffer if the case were to proceed to the courts.

===Canada (Alberta)===
In [[Alberta]], [[Canada]], there are three steps to foreclosure. First, the owner is behind in mortgage payments but still retains full control of the property. Then, the owner is still on title but has lost control of the property to the Court of Queens Bench of Alberta. Last, the legal title has been transferred by the courts to the banks.

The entire foreclosure process in Alberta can take a year or longer. The original owners try to sell over the value to solve their financial problems. The courts favour the owners over the banks and so rarely sell under value. The banks have the money and so never sell under value.

Foreclosures are also sold as is with no recourse for buyers if something goes wrong. That makes foreclosures generally overpriced and risky.