In North Dakota the only instrument of security used is the mortgage lien and this means that the only way to foreclose on a property is through judicial means. There is no power of sale, no non-judicial foreclosure and no deed of trust allowed in North Dakota Law. This simplifies matters but it also makes the process longer and cost more money. So this state is a lien theory state in which the actual property secures the loan.
Although the typical timeline for judicial foreclosures in this State is 90 days, it often takes much longer. This is chiefly only when the matter is contested or if the borrower files for bankruptcy. Once the lender has petitioned the courts for the foreclosure to take place, the courts allow a certain amount of time for the defaulter to clear up the amount owing on the delinquent loan. If they are unable to do this then the court will grant a decree of sale and the property will be auctioned to the highest bidder at a Sheriffs sale.
The lender has to give the borrower at least 30 days prior notice of their intention to foreclose, which must be sent to them by registered mail no more than ninety days before the foreclosure filing. If these terms are not adhered to the process ahs to be started again from the beginning.
The borrower has rights of redemption for up to one year after the sale has taken place, and 6 months in the case where a mortgage contains a clause for short-term redemption. Deficiency judgments are not allowed if the property is residential and measures less than 40 acres in extent. Deficiency judgments are allowed for agricultural holdings of greater than 40 acres and are subject to fair market values.