How Foreclosure Works in Montana

Both. Under the Small Tract Financing Act, a trust indenture (deed of trust) on property of 40 acres or less can be foreclosed out of court by the trustee through advertisement and sale, or, at the lender's (beneficiary's) option, through a court case like a mortgage foreclosure. Ordinary mortgages are foreclosed through the courts.

For a trustee's sale, the trustee or lender must record a notice of sale in each county where the property is located, stating the default, the amount owed, the election to sell, and the date, time and place of sale. At least 120 days before the sale, a copy of the recorded notice must be sent by certified mail to the borrower (grantor), anyone named in the trust indenture to receive notice, anyone who recorded a request for notice, successors in interest, and later lienholders of record. At least 20 days before the sale, the notice must be posted in a conspicuous place on the property, and it must be published in a local newspaper once a week for 3 successive weeks (the last publication at least 20 days before the sale).

The trustee's sale date must be at least 120 days after the notice of sale is recorded, and the mailed notice must go out at least 120 days before the sale. The sale must be held between 9 a.m. and 4 p.m. The trustee may postpone a sale by public announcement for up to 15 days; if a sale is stopped by a bankruptcy stay or court order, each postponement may be up to 30 days and all postponements together may not exceed 120 days.

Yes, for trust indentures. At any time before the time set for the trustee's sale, the borrower (or a successor, junior lienholder, or junior trust-indenture beneficiary) may pay the lender the entire amount then due, including actual costs and reasonable trustee's and attorney fees, but not the part of the principal that would not be due without the default. The foreclosure is then canceled and the loan is reinstated as if it had never been accelerated.