What is meant by foreclosure in real estate?

Foreclosure refers to the legal process through which a lender takes possession of a property when the borrower has failed to make mortgage payments. In this scenario, the borrower is typically in default on their loan obligations, prompting the lender to initiate foreclosure proceedings in order to recover the owed funds by selling the property. This process effectively removes the borrower's rights to the property and allows the lender to recoup their investment by selling the house, often at a public auction.

The other choices do not accurately describe foreclosure. Inspecting a property for sale relates to property evaluations, while an agreement to sell a property at a fixed price pertains to a purchase contract. Evaluating a property's marketability involves assessing aspects like location and condition rather than the legal implications of foreclosure. Each of these options describes a different aspect of real estate transactions but does not capture the specific legal procedure that foreclosure represents.