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Definition

A legal option available to a lender who has an asset as collateral which entitles him to sell that asset to recover what is owed to him. In general, foreclosures happen when a person is behind on the repayments of their property mortgage bond. The level of property foreclosures in the economy is an indicator of how stressed consumers are. In general, banks will try to prevent foreclosure by re-negotiating the mortgage bond to make the repayments more affordable. Foreclosure is seen as a last resort.

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