In Montana, after a non-judicial (trust deed) foreclosure, a deficiency judgment against the borrower is generally:

Correct Answer

B) Not allowed, because Montana law prohibits deficiency judgments following non-judicial trust deed foreclosures

In Montana, when a lender forecloses non-judicially under a deed of trust (the most common foreclosure method in the state), the lender generally cannot pursue a deficiency judgment against the borrower for any remaining balance owed after the foreclosure sale. This is a significant protection for borrowers. However, if a lender chooses to foreclose judicially (through the court system), a deficiency judgment may be available, though this process is longer and more costly. Because non-judicial foreclosure is faster and less expensive, lenders typically use it, effectively waiving their right to a deficiency judgment. Montana licensees should understand this trade-off when advising clients facing foreclosure.