Which foreclosure process is initiated by the lender filing a lawsuit in court?

The process characterized by the lender initiating a lawsuit in court is known as judicial foreclosure. In this method, the lender must file a legal complaint against the borrower in order to obtain a court order to foreclose on the property. This legal action is necessary because judicial foreclosure involves a court's oversight, allowing the borrower an opportunity to contest the foreclosure in court.

This process ensures due process is followed, giving the borrower the ability to respond to the complaint, potentially negotiate terms, or present any defenses they might have regarding the loan or the foreclosure itself. Judicial foreclosure typically takes longer than non-judicial methods because it follows the formal legal proceedings, including possible court hearings and rulings.

Non-judicial foreclosure, on the other hand, does not involve court proceedings and relies on power of sale clauses already included in mortgage documents. Power of sale foreclosure also implies a similar approach, where the lender can sell the property without court involvement, as specified in the loan agreements. Summary foreclosure is a less common and expedited process sometimes used in specific situations, but it does not generally engage a lawsuit initiated by the lender as a standard practice.

Thus, the identification of judicial foreclosure as the correct answer reflects the legal necessity of court intervention in this type of foreclosure, highlighting