- Judicial Foreclosure Available: Yes
- Non-Judicial Foreclosure Available: Yes
- Primary Security Instruments: Deed of Trust,
Mortgage
- Timeline: Typically 150 days
- Right of Redemption: No
- Deficiency Judgments Allowed: Varies
In Montana, lenders may foreclose on deeds of trusts or
mortgages in default using either a judicial or non-judicial foreclosure process.
Judicial Foreclosure
In judicial foreclosure, a court decrees the amount of the
borrowers debt and gives him or her a short time to pay. If the borrower fails
to pay within that time, then the court will issue a notice of sale.
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 notice of sale must be recorded in the county where the
property is located and then: 1) mailed, by registered or certified mail,
to the borrower at his last known address at least 120 days before the foreclosure
sale; 2) published once a week for three (3) successive weeks in a newspaper
of general circulation in the county where the property is located; and 3)
posted on the property at least twenty (20) days before the foreclosure sale.
The notice must contain the time, date and place of sale,
the borrowers, lenders and trustees name, a description of both the property
and the default, and the book and page where the deed is recorded.
The trustee must conduct the sale between the hours of 9:00
am and 4:00 pm at the courthouse in the county where the property is located.
The property must be sold at public auction to the highest bidder.
The sale may be postponed for up to fifteen (15) days by
posting a notice at the time and place where the sale was originally scheduled.
Lenders may not obtain a deficiency judgment against the
borrower and the borrower has no rights of redemption.
More information
on Montana foreclosure laws.
