What do land foreclosures mean?

Land foreclosures are areas of ground with specific boundaries that have been repossessed by banks or lenders due to defaults on the terms of the loans. Once foreclosure proceedings are complete, full ownership of the land is transferred to the institution that granted the loan.

Once a land loan goes into default, the lending institution sends the borrower a demand for immediate payment, or a Notice of Default. If the borrower doesn't comply or arrange an agreement, the lender can then continue with formal proceedings. Many land foreclosures are sold through auctions, but others sell through loan assumption during preforeclosure processes.