Utah foreclosure law

Utah foreclosure law allows both judicial and non-judicial foreclosures (lenders can foreclose in or out of court). Mortgages and deeds of trust are considered the primary security instruments. The timeline for a Utah foreclosure varies depending on the process used and the severity of the default.

Judicial foreclosure
A judicial foreclosure is used when the mortgage or deed of trust does not have a Power of Sale clause. This clause otherwise allows the lender to do the foreclosure outside of court. In the absence of the clause, the lender has to file a lawsuit and get a decree of sale before foreclosure can begin.

Once the court issues a decree of sale, the borrower is given a short time frame within which to pay the past-due balance and associated costs. If the default isn’t cured within the deadline, the court orders a normal execution sale and the home is sold off.

Non-judicial foreclosure
The non-judicial process is used for mortgages and deeds of trust that contain a Power of Sale clause. This clause serves as an endorsement for the lender to sell the home as payment for the loan in case the borrower defaults. This power may be exercised by the lender himself, or passed on to a representative or trustee.

The terms outlined in the Power of Sale are usually followed for the foreclosure. However, if the clause does not indicate the time and place of the sale, the following procedures are conducted:

1) The lender publishes a Notice of Sale in a newspaper circulated in the county where the sale will take place. The notice must appear at least once a week for three successive weeks, with the last ad appearing anywhere from 10 to 30 days before the sale date.

2) At least 20 days before the foreclosure sale, the same notice is posted at the recorder’s office of the county where the home is located, and on a prominent spot on the property itself.

3) The foreclosure sale takes place between 8am and 5pm, at the date and place specified in the notice.

Right of Redemption and deficiency claims
Utah gives borrowers a Right of Redemption, but the period can vary from case to case. It is possible for the court to give a longer redemption period than is usually given in regular judgments. Lenders can also file deficiency suits to cover the difference between the balance and the foreclosure sale price, or take possession of the property until the deficiency is settled.

Loan Modification Case Studies