Real Estate Glossary > N > Notice of Default Definition

A note from a lender indicating that the borrower has fallen two months behind on his payments. At this point, the homeowner will have 2 - 3 months to pay off the owed amount before the lender will proceed with the foreclosure process Foreclosure is a process that transfers the right of home ownership from the homeowner to the bank or lender. A home goes into foreclosure when the owner stops paying his mortgage loan payments. . The lender files the notice of default in the county where the home is located and sends a copy to the buyer. The homeowners may work with their lender to refinance The process of paying off one loan to get another with a better interest rate and terms. their loan or try to sell their home as a short sale A home for sale whose owner owes more on the mortgage than the home is worth. Homeowners hope to sell their home as a short sale to avoid penalties associated with going into foreclosure. if they owe more on the mortgage than the home is worth. The Obama Administration is currently at work to help homeowners modify their mortgages and stay in their homes.