Idaho State Statutes - Idaho Attorney Directory

(1)
Transfers in trust of any estate in real property as defined in section
45-1502(5), Idaho Code, may hereafter be made to secure the performance of an
obligation of the grantor or any other person named in the deed to a
beneficiary. Where any transfer in trust of any estate in real property is
hereafter made to secure the performance of such an obligation, a power of
sale is hereby conferred upon the trustee to be exercised after a breach of
the obligation for which such transfer is security, and a deed of trust
executed in conformity with this act may be foreclosed by advertisement and
sale in the manner hereinafter provided, or, at the option of beneficiary, by
foreclosure as provided by law for the foreclosure of mortgages on real
property. If any obligation secured by a trust deed is breached, the
beneficiary may not institute a judicial action against the grantor or his
successor in interest to enforce an obligation owed by the grantor or his
successor in interest unless:
(a) The trust deed has been foreclosed by advertisement and sale in the
manner provided in this chapter and the judicial action is brought
pursuant to section 45-1512, Idaho Code; or
(b) The action is one for foreclosure as provided by law for the
foreclosure of mortgages on real property; or
(c) The beneficiary's interest in the property covered by the trust deed
is substantially valueless as defined in subsection (2) of this section,
in which case the beneficiary may bring an action against the grantor or
his successor in interest to enforce the obligation owed by grantor or his
successor in interest without first resorting to the security; or
(d) The action is one excluded from the meaning of "action" under the
provisions of section 6-101(3), Idaho Code.
(2) As used in this section, "substantially valueless" means that the
beneficiary's interest in the property covered by the trust deed has become
valueless through no fault of the beneficiary, or that the beneficiary's
interest in such property has little or no practical value to the beneficiary
after taking into account factors such as the nature and extent of the estate
in real property which was transferred in trust; the existence of senior liens
against the property; the cost to the beneficiary of satisfying or making
current payments on senior liens; the time and expense of marketing the
property covered by the deed of trust; the existence of liabilities in
connection with the property for clean up of hazardous substances, pollutants
or contaminants; and such other factors as the court may deem relevant in
determining the practical value to the beneficiary of the beneficiary's
interest in the real property covered by the trust deed.
(3) The beneficiary may bring an action to enforce an obligation owed by
grantor or his successor in interest alleging that the beneficiary's interest
in the property covered by the trust deed is substantially valueless without
affecting the priority of the lien of the trust deed and without waiving his
right to require the trust deed to be foreclosed by advertisement and sale and
the beneficiary may, but shall not be required to, plead an alternative claim
for foreclosure of the trust deed as a mortgage in the same action. If the
court finds that the property is not substantially valueless, the beneficiary
may seek judicial foreclosure of the trust deed, or he may dismiss the action
and foreclose the trust deed by advertisement and sale in the manner provided
in this chapter. If the court finds that the beneficiary's interest in the
property covered by the trust deed is substantially valueless and enters a
judgment upon the obligation, when that judgment becomes final the beneficiary
shall execute a written request to the trustee to reconvey to the grantor or
his successor in interest the estate in real property described in the trust
deed. If the beneficiary obtains judgment on an obligation secured by a trust
deed pursuant to subsection (1)(c) of this section, the lien of the judgment
shall not relate back to the date of the lien of the trust deed.

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