Montana Foreclosure Laws

Montana foreclosure can be carried out either by a judicial process or non-judicial process. Foreclosure proceeding depends on the presence of Power of Sale clause in a mortgage agreement or deed of trust. A Deed of Trust is the Instrument of Security. Typical foreclosure timeline is 5 to 6 months.

Judicial And Non-Judicial Foreclosure Information

A judicial foreclosure is applicable if the mortgage agreement does not have a Power of Sale provision. When the borrower defaults on payments, the lender can file a complaint to foreclose a property in question. This complaint which is also known as lis pendens should be filed in court. The borrower is expected to respond to the complaint. With this type of foreclosure, the court has the final decision on amount due to the lender as well as the allotted time for the borrower to pay his/her debt. If the borrower fails to pay off the debt after a given period, the lender can schedule the foreclosure sale.

When the mortgage agreement contains a Power of Sale, which is signed by the borrower, a non-judicial foreclosure applies. This provision authorizes the lender to pursue a foreclosure on a property in the event that the borrower defaults on payments. To begin the foreclosure, the lender has to file a Notice of Sale with the county recorder.

Under Montana foreclosure laws, a fair treatment is given to both the borrower and the lender to settle differences. At any time up until the date of the foreclosure sale, the borrower has the power to stop the foreclosure proceedings by paying off the full amount owed plus applicable costs to the lender.

Foreclosure laws in Montana neither support after-sale statutory right of redemption nor deficiency judgment for out-of-court foreclosures. For other states that allow deficiency judgment, a lender can file a deficiency claim and collects the difference between of the amount of the property sold for at the auction and the amount of the original loan. The borrower pays that amount to the lender.

Foreclosure sale, which is similar to that of public auctions, usually occurs at the county courthouse and supervised by a trustee. The property is awarded to the highest bidder who can take possession of the property 10 days after the issuance of the deed.

Notice Of Sale Montana

For non-judicial foreclosures, the Notice of Sale should be initiated by the lender and the homeowner or borrower should be notified at least 120 days prior to the date of the public auction. For 3 successive weeks, the Notice should be published once a week in a local newspaper. Also, the Notice should be posted on the property undergoing a foreclosure.