- 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.
More information on South Dakota foreclosure laws.
