Utah foreclosure Law
Utah State Foreclosure Law dictates that lenders may avail of the Judicial and Non-Judicial processes to foreclose deeds of trust or mortgages in default. The typical time of process varies, depending on the process employed, and the deeds of trust and mortgages are the primary security instruments used. Deficiency Judgments and the Right of Redemption are both practiced in the State of Utah.
Judicial Foreclosure is used when no power of sale exists in the security instruments. Petitioners must file a lawsuit in order to obtain a court order to foreclose. It has been a general practice that when the court declares a foreclosure, the property will be auctioned off and will subsequently be awarded to the highest bidder. On the other hand, Non-Judicial Foreclosure is used when a power of sale clause is expressed in the security instruments. “Power of Sale” is the process wherein the borrower agrees to sell the property in dispute to settle the remaining balance from a loan in case of default. Its most obvious difference from the judicial foreclosure is that it doesn’t need any court order to auction off the property as it is already stated in the security instruments. The lender or their duly designated representative, commonly referred to as the “trustee,” may execute the “power of sale.”
Power of Sale Foreclosure Guidelines
Should the security instruments contain a power of sale clause, the terms specified therein must be strictly followed. Otherwise, the non-judicial foreclosure should be carried out according to the process specified as follows:
- A Notice of Sale must be published in a county newspaper of the property’s locale. It should be published for 3 consecutive weeks before the foreclosure sale. The last publication of the notice should occur between 10 to 30 days before the scheduled date of the foreclosure sale.
The Notice of Sale must also be posted, at least 20 days before the scheduled foreclosure sale, in a conspicuous place on the foreclosed property, as well as at the Office of the County Recorder in the property’s locale.
- The date and place of the foreclosure sale must be clearly stated in the Notice of Sale and must take place between 8:00 a.m. to 5:00 p.m.
- The foreclosure sale usually takes the form of a public auction where the property is awarded to the highest bidder for cash.
Note:
- Borrowers do have a right of redemption in Utah. However, the court may extend the redemption time past the time allowed in regular judgments making the borrower’s period to exercise his right of redemption extremely variable and completely dependent upon the court’s ruling.
It is possible to obtain a deficiency judgment against the borrower if the property has been sold for less than the amount originally owed. Should the lender obtain a deficiency judgment in his favor, the borrower is required to settle the difference between the amount owed and the property’s selling price. The lender may seize a property of the borrower until the difference is settled. |
