What action does a servicer take in the non-judicial foreclosure process?

In the non-judicial foreclosure process, a servicer issues a Notice of Default (NOD) to the borrower as an essential first step. This notice serves to formally inform the borrower that they have defaulted on their mortgage payments. It outlines the specific nature of the default—such as how many payments are overdue—and provides a timeline within which the borrower can take action to remedy the situation, typically by making the overdue payments.

Issuing the NOD is crucial because it initiates the process of foreclosure without going through the court system, which is a hallmark of non-judicial foreclosure. This notification also ensures that the borrower is aware of the consequences of their default and gives them a chance to either bring their account current or face the potential of losing their home.

Other actions mentioned in the other choices, such as collecting overdue payments, filing lawsuits, or initiating property appraisals, do not reflect the specific role of the servicer within the non-judicial context, where the focus is more on notifying the borrower of the default status.