South Dakota foreclosure is accomplished most commonly through the court system via judicial foreclosure. Certain mortgages may be foreclosed via advertisement, though foreclosure by advertisement is uncommon.
In a South Dakota foreclosure, the foreclosure process is started by the lender submitting a complaint in court pertaining to the borrower’s default. In most foreclosures, the borrower has 30 days to answer court filing before the foreclosure process continues.
South Dakota does not require lenders to mail a Notice of Default, (NOD), the borrower before initiating the foreclosure process; however, most mortgages have this requirement written into the verbiage of the Document.
In a South Dakota foreclosure, the borrower generally gets the right to:
- receive a pre-foreclosure breach letter
- apply for loss mitigation
- receive notice of the foreclosure
- receive special protections if the borrower or spouse is in the military
- pay off the loan to prevent a sale
- file for bankruptcy
- redeem the home after the sale, and
- get any excess money after a foreclosure sale.
Notice of Sale & Auction
After the court has ruled that the foreclosure can move forward, the lender must publish a Notice of Foreclosure Sale in the local newspaper. In addition, a minimum of 21 days before the sale, the lender must serve a written copy of sale notice to the borrower and any other lien holders.
Once all publication requirements are met, the county sheriff will conduct a sale between the hours of 9 a.m. and 5 p.m. on a regular business day. Anybody, including the lender may bid at the sale. Many times, the lender will bid first with the default amount. After the sale, the highest bidder is provided with a sale certificate. This bidder is entitled to a deed transferring ownership once the redemption period has expired.
The borrower or any lien holders have the right to redeem the property and void the sale by repaying the total amount owed. Redemption requires written notice to the purchaser and the county sheriff. The redemption period is usually six months unless the property is vacant, in which case the redemption period is only two months.