I as the note holder have had to do this in the past a couple of times. Your trustee (attorney) handles most of the process. Not difficult, but does take some time. If the defaulting party has additional liens against the property, it makes it more difficult and takes more time. In one case where I had to foreclose, the defaulting party had an IRS tax lien against the property and it took an extra couple of months to get the lien removed as IRS alway has a senior position to any lenders. For more details, talk to one of the local trustees. There are only a handful in Arizona that do most of the foreclosures.
If you are considering doing an owner carry, talked to a real estate attorney first. Also make sure the borrow puts more than enough down to cover potential lost payments, legal expenses and damages to property.
If you have a borrower who has defaulted talk to the borrow to see if you can work something out quickly such as a Deed in Lieu. A title company can assist with preparing a Deed in Lieu. Don't let it slide, if you can work something out immediately go straight to an attorney to do the foreclosure.
In any case, seek legal advise. Could be very costly if you don't.