Paul Clark
In this Blog we open the conversation with
economic loss caused by the current mortgage
crisis.
South Dakota Foreclosure Law Summary
Quick Facts
- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of
Trust, Mortgage
- Timeline: Typically 90 days
- Right of Redemption: Varies
- Deficiency Judgments Allowed: Varies
In South Dakota,
lenders may foreclose on deeds of trusts or
mortgages in default using either a judicial or
non-judicial foreclosure process.
Judicial Foreclosure
The judicial process of foreclosure, which involves
filing a lawsuit to obtain a court order to
foreclose, is used when no power of sale is present
in the mortgage or deed of trust. Generally, after
the court declares a foreclosure, your home will be
auctioned off to the highest bidder.
Non-Judicial Foreclosure
The non-judicial process of foreclosure is used when
a power of sale clause exists in a mortgage or deed
of trust. A "power of sale" clause is the clause in
a deed of trust or mortgage, in which the borrower
pre-authorizes the sale of property to pay off the
balance on a loan in the event of the their default.
In deeds of trust or mortgages where a power of sale
exists, the power given to the lender to sell the
property may be executed by the lender or their
representative, typically referred to as the
trustee. Regulations for this type of foreclosure
process are outlined below in the "Power of Sale
Foreclosure Guidelines".
Power of Sale Foreclosure Guidelines
If the deed of trust or mortgage contains a
power of sale clause and specifies the time,
place and terms of sale, then the specified
procedure must be followed. Otherwise, the
non-judicial power of sale foreclosure is
carried out as follows:
A foreclosure notice must be published
once a week for four successive weeks in a
newspaper of general circulation in the
county where the premises are located.
At least twenty-one days prior to the date
set for sale, the lender must serve a
written copy of the notice of foreclosure
sale on the borrower and any lien holder
whose interest in the property being
foreclosed would be affected by the
foreclosure.
Said notice must contain the names of the
borrower and lender, the mortgage date, the
amount due, a description of the premises
and the time and place of sale.
The sale must be made by the sheriff of
such county, or his deputy, between the
hours of 9:00 am and 5:00 pm to the highest
bidder. Any person including the mortgagee
(lender) may bid at the sale. The winning
bidder will receive a certificate of sale.
The sale may be postponed, from time to
time, by inserting a notice of such
postponement, as soon as possible, in the
newspaper in which the original
advertisement was published, and continuing
such publication until the time when the
postponed sale occurs.
If the property is 40 acres or less, and the
mortgage contains a power of sale clause, then a
180-day period of redemption exists. If the property
is abandoned, the time period is reduced to 60 days.
Generally, unless special short-term redemption
mortgage provisions apply, borrowers may redeem
within one year of the date of sale.
