The foreclosure process is relatively straight forward. If you don’t make your payments for a few months, the bank is going to go after the collateral, aka the property. Exactly how long it takes depends on a few factors:

The leniency of the bank

The current market

The reason that the mortgagee is unable to make timely payments on their mortgage.

The typical period of time from when you will go into foreclosure varies, again, depending on the above reasons. However it typically ranges from 3 to 6 months.

In a strong market, banks are more likely to pull the trigger on a foreclosure, as the value of your home is more likely to be greater than what you owe the bank. During the hay day of the beginning of the new millennium, when property values where increasing at a clip of 20% plus in certain areas of the country, a bank would make money in the foreclosure process. As of the writing of this entry (2009) banks would rather modify the terms of your mortgage than send you into foreclosure, in which they may not be able to sell your property, even at a deep discount.