Posted on: 08th Aug, 2007 01:58pm
If your property is sold in a Florida judicial foreclosure and the sale price is less than the actual amount owed, you will be responsible for paying the deficiency. The lender can either forgive this deficient amount or come after you to recover it.
Can lenders get deficiency judgment Florida?
The lender can obtain a judgment against you to recover the deficiency. He has to file a separate motion/lawsuit for a deficiency once the foreclosure sale is complete. The court then holds a hearing to decide if a deficiency judgment can be allowed against you. At the hearing, the lender has to prove that the property value is indeed less than what you owe.
As a borrower, you have the right to oppose your lender's claim for judgment. You will have to prove that the property is worth more than the outstanding mortgage balance at the time of foreclosure. You can use an appraisal or the tax assessed value of the property to support your claim.
As a borrower, you have the right to oppose your lender's claim for judgment. You will have to prove that the property is worth more than the outstanding mortgage balance at the time of foreclosure. You can use an appraisal or the tax assessed value of the property to support your claim.
What happens after lenders get judgment?
Deficiency judgment Florida allows lenders to come after your wages, levy your bank accounts and put liens on your other properties. However, there are certain assets which are exempt from judgments. They include IRA, 401k, other retirement accounts, social security income, unemployment benefits, workers compensation, etc. Your lender has the right to collect on that judgment for 20 years. The interest will accrue every year till it is paid in full. Apart from this, the judgment will show up on your credit report for 7 years and will affect your credit scores adversely.
Are your wages exempt from garnishment?
If you are the head of the family and your net wages are less than $500 per week, you can protect your wages from garnishment. But if you've signed any document allowing the wage garnishment, the lender can come after your wages. In case you are not the head of the family, you can still protect certain part of your wages. Federal law limits the amount of money that can be garnished by your lender. He can take only 25% of your net wages or the amount in excess of 30 times the federal minimum wage per week, whichever is less.
Are homestead properties exempt from deficiency judgment Florida?
Homestead properties are not protected from judgments for mortgage liens. You can protect your home from creditors of unsecured debts under homestead protection. But lenders, who have financed purchase, repair, improvement, etc. of your home, hold a lien on your property. If you default on such secured loans, your home is not protected from judgments.
Does PMI help you cover the deficiency?
Private Mortgage Insurance (PMI) cannot protect you from deficiency judgments. It is meant to protect a lender against the losses from a mortgage default. A PMI is required if you make a down payment of less than 20% on your loan.
Is there a way to avoid deficiency judgments?
If you can stop foreclosure, you can avoid the judgment. In case you're having difficulty in making mortgage payments and a foreclosure is imminent, you can look for various loss mitigation options like loan modification, deed in lieu (DIL), etc. A loan modification can reduce your mortgage payments and help you save the home.
A deed in lieu does not help you retain the home. But it waives off the lender's right to collect the deficiency. This helps you avoid a judgment. However, you should not believe in verbal agreements. If the deficiency is forgiven, ask your lender to give it in writing before you proceed with the deed in lieu.
A deed in lieu does not help you retain the home. But it waives off the lender's right to collect the deficiency. This helps you avoid a judgment. However, you should not believe in verbal agreements. If the deficiency is forgiven, ask your lender to give it in writing before you proceed with the deed in lieu.
Hi I'm currently going through a foreclosure on two properties and would like to know how much time do the banks take to file a deficiency if they decide to do this? How will I know the sale price of the property at the court?
Any help would be greatly appreciated.
Any help would be greatly appreciated.
In your responce to fireman you state the property in Costa Rica is safe.
"If the lender has already started foreclosure proceedings against the property, he would probably not accept a deed in lieu of foreclosure. However, she can still talk to the lender and see if he would allow her to do the deed in lieu. In case the lender pursues a judicial foreclosure, it will take some time for him to take over the ownership of the property. The entire foreclosure process is likely to take around 90-120 days. So, she can expect to stay in the property till the time foreclosure process is complete and the house is auctioned off.
If there remains a huge deficiency from the foreclosure sale of the home, the lender can obtain a deficiency judgment against her. However, the lender will not be able to go after her assets in another country. Those assets will remain safe from liens."
However I am in the same boat with property in Central America. From my research online the US morgage holder can hire a collection company in Costa Rica to get those assets as well. My foreign lawyer advised me to put my foreign property in a anonomous corporation(cost 11k). I cant find the law on this subject and my US lawyer has no idea about it. So my question is, how do I know if my foreign property is safe from a US judgement resulting from a forclosure on my principle US home?
"If the lender has already started foreclosure proceedings against the property, he would probably not accept a deed in lieu of foreclosure. However, she can still talk to the lender and see if he would allow her to do the deed in lieu. In case the lender pursues a judicial foreclosure, it will take some time for him to take over the ownership of the property. The entire foreclosure process is likely to take around 90-120 days. So, she can expect to stay in the property till the time foreclosure process is complete and the house is auctioned off.
If there remains a huge deficiency from the foreclosure sale of the home, the lender can obtain a deficiency judgment against her. However, the lender will not be able to go after her assets in another country. Those assets will remain safe from liens."
However I am in the same boat with property in Central America. From my research online the US morgage holder can hire a collection company in Costa Rica to get those assets as well. My foreign lawyer advised me to put my foreign property in a anonomous corporation(cost 11k). I cant find the law on this subject and my US lawyer has no idea about it. So my question is, how do I know if my foreign property is safe from a US judgement resulting from a forclosure on my principle US home?
Hi!
Welcome to forums!
To Guest,
As you've short sold the property, the lender can come after you to recover the deficient balance. In your case, the lender has assigned your account to a collection agency and they'll collect the dues from you. You will have to negotiate with the collection agency if you're unable to pay the dues. In case, the collection agency is not ready to help you, then you may think about filing bankruptcy.
To Mikey,
The lender who forecloses your home in US may hire a collection agency in another country and try to go after your assets. However, in most cases, the lenders do not do so. In order to go after your property in another country, your lender will have to file a lawsuit against you in that country and get a judgment.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
To Guest,
As you've short sold the property, the lender can come after you to recover the deficient balance. In your case, the lender has assigned your account to a collection agency and they'll collect the dues from you. You will have to negotiate with the collection agency if you're unable to pay the dues. In case, the collection agency is not ready to help you, then you may think about filing bankruptcy.
To Mikey,
The lender who forecloses your home in US may hire a collection agency in another country and try to go after your assets. However, in most cases, the lenders do not do so. In order to go after your property in another country, your lender will have to file a lawsuit against you in that country and get a judgment.
Feel free to ask if you've further queries.
Sussane
If I have a judment against me for a morgage and I buy a house 3 years from now. Would they lien the home or force a sale. What states provide the best judgement protection for people besides wage garnishment protection in SC, NC, TX, PA?
Welcome Mikey,
In order to place a lien on your new property, the lender will have to file a lawsuit against you. Moreover, you need to check your state laws to know about the statute of limitations in this regard. If you pay off the judgment, then the lender will not be able to place a lien on your property.
In order to place a lien on your new property, the lender will have to file a lawsuit against you. Moreover, you need to check your state laws to know about the statute of limitations in this regard. If you pay off the judgment, then the lender will not be able to place a lien on your property.
I have just received my notice of foreclosure by Chase (balance of 127K) from the Circuit Court. I moved out of my home in Jan 2009 after both my wife and I were permanentley laid off and I had asked for help but got none from Chase and also asked Countrywide (second mort. Bal of 68K) for help and got none. We were forced to move into a Mobile home we also owned outright. All of our savings have been exhausted paying medical bills and other loans off. Our only assets are the Mobile home, a 2003 car and a 1993 motorcycle. I now collect SS and my wife a small annuity from a previous divorce agreement. Will the Mortgage companies come after what little we have left since we are just able to make our current obligations.
It has become a sad state that the US citizens have been put into because of the economy. Thanks
It has become a sad state that the US citizens have been put into because of the economy. Thanks
forgot to mention that 4 of the 8 credit obligations I am still paying on and am current on are 3 Chase credit cards and a Chase truck loan that they already have a lien on.
Hi willie,
After your property is foreclosed by the lender, you would be liable for paying the deficient balance resulting from the sale of the property. If you're unable to pay the balance dues, then the lender may come after your other assets and place a lien on it.
Thanks
After your property is foreclosed by the lender, you would be liable for paying the deficient balance resulting from the sale of the property. If you're unable to pay the balance dues, then the lender may come after your other assets and place a lien on it.
Thanks
I'm confused. I'm doing a short sale in Florida. The defficency is about $50,000. It's unfortunatly with BOA. I'm current with my mortgage... moving due to illness in family. We have excellent credit. From everything I'm reading BOA won't forgive the deficient balance in writing on the aproval letter. Do they have to sue me in court or can it go to a debt collection company? I think all of these deficencies are going to debt collectors and it's a ticking time bomb. How does it go...
I also think because we have excellent credit it might be an reason to come after us. How do we protect ourself?
an investment real estate property was foreclosed in west va by the first mortgage co and the second mortgage loan was sold to another company before the property was foreclosed. we received a letter from that company's attorney that we need to pay the amount owed on the second mortgage. can they come after us to collect the amount owed.
if i gave back my property to the bank and they did not give me a written statement that i am even with them ,can i request them to give me a defiency judgement statement,saying i don't owe them any monies,,and or request that if they do not give me a written release,that i want any monies gained,from the sale of said property returned to me,??/thanks eddie
Hi illucy,
In case of a short sale, the lenders do not forgive the deficient balance. You are liable for paying the dues to the lender. There are chances that the lender will assign the account to a collection agency if you're unable to pay off the balance amount. The collection agency will be able to collect the dues from you. You will have to negotiate with them in order to pay it off. A short sale will lower your score by 80-100 points. You can stop the negative affects of charge off by paying off the deficient balance after the property sale.
Hi Susan,
As far as I can understand, the second mortgage lender has charged off the loan and assigned it to a collection agency. The collection agency can come after you in order to recover the dues. You are liable to pay off the dues to the collection agency.
Hi Emally,
You must have transferred the property to your lender while applying for a deed in lieu. Thus, you are not the owner of the property any longer as the property deed does not mention your name. When the property is sold off, the lender will report it to the credit bureaus and the information may be updated. You may ask your lender to provide you with a written statement regarding property transfer. However, it's the lender's discretion whether or not he would accept your request.
Thanks,
Jerry
In case of a short sale, the lenders do not forgive the deficient balance. You are liable for paying the dues to the lender. There are chances that the lender will assign the account to a collection agency if you're unable to pay off the balance amount. The collection agency will be able to collect the dues from you. You will have to negotiate with them in order to pay it off. A short sale will lower your score by 80-100 points. You can stop the negative affects of charge off by paying off the deficient balance after the property sale.
Hi Susan,
As far as I can understand, the second mortgage lender has charged off the loan and assigned it to a collection agency. The collection agency can come after you in order to recover the dues. You are liable to pay off the dues to the collection agency.
Hi Emally,
You must have transferred the property to your lender while applying for a deed in lieu. Thus, you are not the owner of the property any longer as the property deed does not mention your name. When the property is sold off, the lender will report it to the credit bureaus and the information may be updated. You may ask your lender to provide you with a written statement regarding property transfer. However, it's the lender's discretion whether or not he would accept your request.
Thanks,
Jerry
my property was mot forclosed on ,we made a deal for them to take the property instead of forclosure,so with that in mind if the house does not appraise for what isd owed to the bank,can they collect the difference of money owed from money borrowed and the actual what they sell the house for,if what they sell the house for is less than the amoungt we owe,,and also if we do not have a release in writing,can we threaten them to give us a written agreemeny,instead of them selling the house for more than we owed and keeping the extra money???????????????????/ thanks eddie
hi eddie!
welcome to forums!
if the lender goes for a deed in lieu of foreclosure, then you won't be liable for paying the deficient balance resulting form the sale of the property. the lender will forgive the deficient amount. this will be considered as your income and the lender will issue a 1099c form to you. however, depending upon the mortgage debt relief act, you won't be liable for the deficient balance.
feel free to ask if you've further queries.
sussane
welcome to forums!
if the lender goes for a deed in lieu of foreclosure, then you won't be liable for paying the deficient balance resulting form the sale of the property. the lender will forgive the deficient amount. this will be considered as your income and the lender will issue a 1099c form to you. however, depending upon the mortgage debt relief act, you won't be liable for the deficient balance.
feel free to ask if you've further queries.
sussane