Do you get credit for deficiency in a foreclosure?
Do you get credit for deficiency in a foreclosure?
You will be given credit for the greater of the foreclosure price or the fair-market value of the home. You are not liable for the deficiency in a non-judicial foreclosure if the property is residential and you live in it. You are liable for the deficiency in a judicial foreclosure.
Can the bank get a deficiency judgment Afte?
Deficiency judgments are allowed under South Carolina law. After a foreclosure, the total amount the borrower owes to the bank might be more than the home sold for at the foreclosure sale. The difference between the price and the debt is the “deficiency.” Example.
Who is responsible for a deficiency judgment after foreclosure?
Homeowners’ responsibility after foreclosure. Borrowers who are left facing a large deficiency judgment after foreclosure often turn to bankruptcy in order to protect their assets.
What happens to the remaining debt after a foreclosure?
When a borrower loses their home to foreclosure and still owes their lender money after the sale, the remaining debt is usually referred to as a deficiency. Lenders can sue to recover this amount. For example, if you owe $500,000 on your mortgage and can no longer afford to make payments on the note,…
How does a deficiency work in a foreclosure?
Because you failed to pay back your mortgage loan, the bank had the right to sell your home to recoup the debt. After foreclosure, you might still owe your bank some money (the deficiency), but the security (your house) is gone. So, the deficiency is now an unsecured debt.
Can a bank get a deficiency judgment for$ 50, 000?
(N.Y. Real Prop. Act. Law § 1371 (2)). Example: If the total debt is $500,000 and the bank bids $450,000 at the foreclosure sale and purchases the property, the deficiency is $50,000. Generally, this means the bank could get a deficiency judgment for $50,000 and then collect that amount from the borrower.
Can a bank seek a deficiency judgment in North Carolina?
Banks who have made mortgages in North Carolina are allowed to seek deficiency judgments against borrowers. The lesson to be learned is that if you owe more on your mortgage than your house is worth and the property is in a state that allows lenders to seek deficiency judgments, you may still owe money even after foreclosure.
What happens if you have a deficiency on House No.2?
Although some states restrict the collection of deficiency balances, most states allow deficiencies to be treated like all other unsecured debts. If you end up owing a deficiency balance on House No. 2, it is possible that the creditor may file a lawsuit against you to collect on the debt.