What is a Notice of Default?

A notice of default is a document that a mortgage lender files when a mortgage loan goes into default. This occurs when the borrower of a mortgage loan does not keep up with the payments that are due on their mortgage. 

Public Records

When a borrower goes into default on the mortgage, their mortgage lender will file a notice of default in the local public records office. Sometimes, this notice will be posted in the local newspaper. In other cases, it will simply remain on file at the public records office. This is the first step in the process of the lender foreclosing on a property.

Property Notice

Some lenders will also post a notice of default on the front door of the property that is in default. This lets everyone who comes to the house know that it is in default and is going through the process of foreclosure.

Reinstatement Period

Every state has different rules when it comes to foreclosure. Many of them allow the borrower to take advantage of a reinstatement period. During this 90 day window the borrower can catch up on the payments and take the mortgage back out of default. They can then resume making payments without going through foreclosure.