South Dakota Foreclosure Laws

Expected Timeline: Six to nine months
Security Instrument: Mortgage or Deed of Trust. Mortgages most commonly used.
Type of Process: Judicial or nonjudicial. Nonjudicial foreclosure most common.
Protections for Servicemembers: S.D. Cod. Laws Ann. § 33-17-15.1
Time to Respond: In nonjudicial foreclosure, notice must be published for four weeks. Notice must also be given to homeowners at least 21 days before sheriff sale.
Reinstatement Period: Reinstatement is available under judicial foreclosure until court enters final judgment.
Protections for High-Cost Mortgages: None.
Redemption Period: Redemption is allowed for one year after date of foreclosure auction. This may not apply if mortgage is designated as a short-term redemption mortgage in loan documents. In this case, redemption is six months from date of sheriff sale.
Eviction Process: In a judicla foreclosure, the judge may order possession given to new owner after redemption ends. Former owners must receive a three day notice to quit. After this, the new owner may file an eviction lawsuit.
Deficiency Judgments: Allowed. If lender buys property back at auction, deficiency amount is limited to difference between fair market value at time of sale and balance due on mortgage.
Limits on Deficiency Judgments: If mortgagee or holder of note purchases the property at auction, any deficiency is limited by the market value. In judicial foreclosure proceedings, a deficiency judgment may be barred. In cases of voluntary foreclosure, no deficiency or surplus is allowed.
Cash Exempted in Bankruptcy: $4,000 for single person, $6,000 for married couple.
State Statutes: S.D. Cod. Laws Ann. § 21-48-1 to 21-48-26

South Dakota foreclosure law allows lenders to initiate foreclosure by either the Non-Judicial or Judicial Foreclosure process. If no power of sale clause is present in the original loan documents, then the lender must pursue Judicial Foreclosure procedures and sue the borrower in court to obtain an order to foreclose.

If a power of sale clause is present in the original loan documents, then the lender is able to use the Non-Judicial Foreclosure procedures. This clause authorizes the lender to sell the property to satisfy the balance due on the loan in the event the borrower defaults. If the clause specifies the time, place, and terms of the sale, then those details must be adhered to.

The notice of foreclosure and sale must include the time and date of the sale, list the identities of the borrower and lender, include the original date of the mortgage, and list the amount due as well as a description of the property. The notice must be published in a newspaper generally circulated in the county in which the property is located for a period of four (4) consecutive weeks. No less than twenty-one (21) days before the scheduled sale date, the borrower and all other lien holders must be served with a copy of the notice.

The sale is conducted by the county sheriff or a deputy at the place designated in the notice of foreclosure and sale. The time of the sale may be between 9:00 AM and 5:00 PM . If the sale is postponed, a notice of the postponement must be filed in the same newspaper in which the original notice of sale was published. Publication of the new sale date must be continued until the new sale occurs.

The borrower has the right to redeem the property after the sale. The length of time of the redemption period varies. Properties that have been abandoned have a sixty (60) day redemption period. If the property is not abandoned and includes forty (40) acres or less, the redemption period extends to one-hundred and eighty (180) days. If the property contains more then forty (40) acres and is not abandoned, the borrower has one year in which to redeem the property. If the original loan documents define the redemption period otherwise, then that period will be followed.

The lender may sue the borrower for a deficiency judgment on a case by case basis.

State Website: www.legis.state.sd.us