Patricia owns a home in Sheridan, Wyoming with a $180,000 deed of trust loan balance. She defaults, and the trustee's sale results in a winning bid of $150,000—$30,000 less than the outstanding loan balance. After the sale, the lender seeks to recover the $30,000 shortfall. Which statement most accurately describes the lender's options under Wyoming law?
Correct Answer
D) The lender must pursue a separate judicial action to obtain a deficiency judgment against Patricia for the $30,000 shortfall.
Under Wyoming law, after a non-judicial trustee's sale, the lender's non-judicial foreclosure remedy satisfies the security interest in the property, but it does not automatically extinguish the borrower's personal liability for any deficiency. To recover the $30,000 shortfall, the lender must file a separate lawsuit in district court and obtain a deficiency judgment against Patricia. This requires a judicial proceeding separate from the non-judicial foreclosure process itself.
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