Foreclosing Mortgage Liens and Security Interests

Roger Minch
June 24, 2008 — 1,736 views  
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When bringing an action to collect an agricultural loan, friction arises from the fact that the creditor wants to commence the action right away, yet an action to foreclose a real estate mortgage cannot be brought until thirty days after service of the notice before foreclosure.  One solution is to serve the notice before foreclosure, wait the thirty days, and bring one action to foreclose the real estate mortgage(s) and foreclose the personal property security interests.  Another solution is to start the action to foreclose the personal property liens right away specifically reserving the right to amend the complaint later to include a count for foreclosure of the real estate mortgage(s).

However, because of the anti-deficiency judgment statutes, care must be taken to make certain that all personal property liens have been foreclosed and the net proceeds applied to the indebtedness before the creditor completes the real estate foreclosure process and establishes the amount due in the foreclosure action.

Roger Minch


. Mr. Minch's past and present activities include serving as the past chairman of the Continuing Legal Education Committee of the State Bar Association of North Dakota, and as member of the Information and Service Committee of the State Bar Association of North Dakota. He is a current member of the Bankruptcy Rules Committee of the State Bar Association of North Dakota, the Commercial Law League of America, the bankruptcy section of the Minnesota State Bar Association and the American Bankruptcy Institute. He has written numerous Continuing Legal Education outlines and text for legal seminars for the State Bar Associations of North Dakota and Minnesota, banks, savings and loans, credit union associations and private suppliers of continuing legal education programs concerning bankruptcy, collections and real estate foreclosure.