Like other states, under federal law, a loan servicer typically must wait until the mortgage payment is more than 120 days overdue before foreclosing on an Oregon property. This period allows you time to find a way to avoid a foreclosure.
Once the period expires, assuming you haven't worked out a loan modification or other loss mitigation option, the bank will probably foreclose using a nonjudicial (out-of-court) process. The bank could, however, choose to use a more expensive judicial procedure by filing a lawsuit in the legal system.
This article covers both foreclosure types and homeowner rights that might help you keep your home.
When Can a Foreclosure Begin in Oregon?
Under a federal mortgage law that took effect in 2014, a servicer usually can't initiate the foreclosure process until the borrower’s mortgage obligation is more than 120 days delinquent. (12 C.F.R. § 1024.41 (2025).) This waiting period gives a struggling borrower time to learn about loss mitigation options and file an application for a foreclosure alternative.
Once the borrower applies for a foreclosure alternative, the servicer can't begin the foreclosure process until it evaluates the submission for a loss mitigation plan.
How Does the Oregon Foreclosure Process Work?
In Oregon, homeowners behind on mortgage payments could face one of two types of foreclosure: a judicial foreclosure (the bank files a lawsuit in court) or a nonjudicial foreclosure (the bank follows out-of-court steps described in state law).
Most foreclosures in Oregon are nonjudicial. Still, here's a brief explanation of each procedure.
Judicial Foreclosure Process in Oregon
This type of foreclosure starts when the bank files a lawsuit in court. The borrower must respond to prevent automatically losing the suit. A borrower who believes the foreclosure is wrongful can fight it by filing an answer with the court.
The action will proceed through the litigation process. If the court determines that the bank can foreclose, it will enter a judgment and an order allowing the bank to sell the home and use the proceeds to pay off the debt.
Nonjudicial Foreclosure Process in Oregon
In a nonjudicial foreclosure, the bank must follow procedures described in the Oregon statutes (laws). After completing the necessary steps, the bank can sell the home at a foreclosure sale.
To start the foreclosure, the trustee records a notice of default in the county records and serves a notice of sale on the borrower 120 days before the sale, either by personal service or mail. The trustee must also send an additional notice with information about how to avoid a foreclosure sale.
The trustee will also publish a notice of sale in a newspaper.
What Are My Rights in an Oregon Foreclosure?
Homeowners in foreclosure have rights in Oregon. Specifically, borrowers can attempt to resolve the matter in a conference, bring the loan current before the sale, or buy back the home after a judicial foreclosure.
Resolution Conference
In most cases, the bank must allow the owner to attend a resolution conference before foreclosing on a residential trust deed (the loan contract). A borrower has this right in both the nonjudicial and judicial processes. (Or. Rev. Stat. § 86.726, § 86.729 (2025).)
At the meeting, the bank, borrower, and a neutral mediator will explore ways to avoid a foreclosure.
Reinstating the Loan
To reinstate the loan and stop a foreclosure sale, you must pay the past due payments (plus fees and costs) at any time prior to five days before a nonjudicial foreclosure sale. (Or. Rev. Stat. § 86.778 (2025).)
Also, the loan contract might provide a more expansive reinstatement period. You’ll want to check your deed of trust or mortgage to determine your rights.
Does Oregon Have a Redemption Period for Foreclosure?
State law sometimes allows a foreclosed homeowner to buy back or “redeem” the home following a foreclosure sale. Oregon law doesn't provide a right to redeem after a nonjudicial foreclosure. (Or. Rev. Stat. § 86.797 (2025).)
But the borrower can redeem the home up to 180 days after a judicial foreclosure. (Or. Rev. Stat. § 88.106, § 18.964 (2025).)
Does Oregon Allow Deficiency Judgments After Foreclosure?
If the home sells for an amount insufficient to pay the loan amount, the difference is known as a "deficiency balance." In Oregon, the bank can't get a deficiency judgment against the borrower after:
- a nonjudicial foreclosure or
- a judicial foreclosure of a residential deed of trust.
Where to Find Oregon’s Foreclosure Laws
Oregon’s nonjudicial foreclosure laws in the Oregon Revised Statutes, sections 86.726 through 86.815. Judicial foreclosures are in sections 88.010 through 88.106. Statutes change, so checking them is always a good idea. How courts and agencies interpret and apply the law can also change. And some rules can even vary within a state. These are just some of the reasons to consult with an attorney if you’re facing a foreclosure.