Foreclosure is the legal process effected through the court system in which a mortgagee (lender—often a bank) terminates a mortgagor’s (borrower’s) interest in the real property in which the mortgagor gave the mortgagee a security interest (a lien) as collateral for the loan used to purchase the property.

Foreclosure generally occurs when a homeowner defaults and fails to make mortgage payments as required by the loan agreement (promissory note).

Foreclosure allows the lender to seize the property, remove the homeowner, and sell the home—all of which are legal remedies the mortgagor and mortgagee agreed to in the mortgage contract.

In South Dakota, foreclosure is a legal process that allows a lender to terminate a borrower's interest in a property due to the borrower's failure to make the required mortgage payments. South Dakota primarily uses the non-judicial foreclosure process, which means that the foreclosure does not need to go through the court system if the mortgage contains a power of sale clause. However, if the mortgage does not contain this clause, the lender must pursue judicial foreclosure, involving the court system. The process begins with the lender providing the borrower with a notice of default and an opportunity to cure the default. If the borrower does not cure the default, the lender can then proceed with scheduling a sale of the property. The borrower may have the right to redeem the property for a certain period after the sale. It is important for homeowners facing foreclosure in South Dakota to understand their rights and obligations under the law and to seek advice from an attorney if they are at risk of losing their home.