Montana Foreclosure Law and Procedure
Real estate may be foreclosed on by filing a lawsuit or by conducting a non-judicial private foreclosure sale in compliance with Montana law.
Montana Judicial Foreclosures
Unless the Small Tract Financing Act applies, then the lender must foreclose either by filing a lawsuit and seeking an order of sale, or else following a special foreclosure procedure.
If applicable, the state’s special foreclosure procedure requires the lender or person conducting the foreclosure sale to publish post and serve a foreclosure notice at least 30 days in advance of the foreclosure sale. The notices must be advertised in a newspaper where the real estate is located, and if there is no newspaper, then by posting the notices in five conspicuous places in the county. The notice of sale must be further served on the occupant of the property to be foreclosed on and upon every person claiming an interest in the property who may be found in the state of Montana.
Montana Non-Judicial Foreclosures – Small Tract Financing Act of Montana
Upon default of the borrower on his payments and if the mortgage or tract of land is less than 15 acres, then the Small Tract Financing Act applies to foreclosure under the power sale provision of a deed of trust, usually a relatively quick and inexpensive foreclosure procedure.
Montana Foreclosure Guidelines
One hundred-twenty days (120) before the date fixed for the foreclosure sale the trustee must mail foreclosure notices by registered or certified mail to the borrower to all concerned parties. The contents of the notice should have the names of the borrower, lender and trustee; the description of the property in foreclosure; the nature of the default; the amount of the defaulted payment; letter of intent to sell of the trustee or lender; the date of the sale and the time of the sale between 9 a.m. to 4 p.m. mountain standard time.
The place of the sale, which shall be at the courthouse in the county in which the property is located, or at the office or usual place of business of the trustee if it's within the county in which the property is located
Prior to the foreclosure sale, the copy of the recorded notice of sale must be posted in a conspicuous place on the property to be sold for at least twenty (20) days. A copy of the notice shall be published in a newspaper of general circulation in the county in which the property is located once per week for three successive weeks. The posting and the last publication shall be made at least 20 days before the date fixed for the trustee's sale.
The sale may be postponed up to 15 days from the original foreclosure date. The purchaser must pay the high bid price in cash. In return, the purchaser will receive a trustee's deed. The lender may obtain possession on the tenth day following the sale. Any person still in the house or property is to be treated as a tenant at will (a nonpaying tenant).
Montana Foreclosure Redemption
The Small Tract Financing Act eliminates the borrower's right to redeem after a properly conducted foreclosure sale.
Montana Foreclosure Deficiency
Montana does not allow a deficiency judgment unless the foreclosure was done by filing a lawsuit and the sale proceeds were insufficient to pay the judgment. Small Tract Financing Act foreclosures done out of court by advertisement do not give the lender any right to collect a deficiency from the borrower.
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