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.
Hi Buster,
If the mortgage was only in the wife's name, then the lender will only be able to go after the wife's asset.
Thanks
If the mortgage was only in the wife's name, then the lender will only be able to go after the wife's asset.
Thanks
if i short sale my primary residence, can the lender still come after me for a deficiency judgement, or would it be 1099'ed?
We borrowed a line of credit (interest only loan from 2007) against our 1st home in order to build our small retirement place (mobile home). We've had a lease/option (for past year) on the 1st home but don't expect them to take the option to buy. We owe bank $103k and house is now only worth about $75K, if that. Now we can't afford to make the payments on this interest only loan. What should we do? We really anticipated a sale of the 1st home at the end of the lease/option period. The housing market fell so far...at time of line of credit house appraised at apx $115. What a mess. Any help will be appreciated.
Hi!
Welcome to forums!
To mg,
In case of a short sale, the lender has the rights to come after you for the deficient balance. You can negotiate with your lender in order to find out if he can forgive the deficient amount. If he forgives the balance amount, then you will receive the 1099c form.
To crace,
As you're facing hardship in paying off the interest only loan, you should contact your lender and let him know about it. If the lender is convinced about your financial hardship, he would give you a repayment plan by modifying the loan which will make it affordable for you to pay off the loan.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
To mg,
In case of a short sale, the lender has the rights to come after you for the deficient balance. You can negotiate with your lender in order to find out if he can forgive the deficient amount. If he forgives the balance amount, then you will receive the 1099c form.
To crace,
As you're facing hardship in paying off the interest only loan, you should contact your lender and let him know about it. If the lender is convinced about your financial hardship, he would give you a repayment plan by modifying the loan which will make it affordable for you to pay off the loan.
Feel free to ask if you've further queries.
Sussane
We are in a foreclosure on a home in Florida that we have been unable to short sale or deed in lieu. We moved to Colorado to find work, and have no assets.
After the foreclosure:
Will they have to file a deficiency judgment in CO?
Can a deficiency judgment be wiped clear through a bankruptcy?
Thanks
After the foreclosure:
Will they have to file a deficiency judgment in CO?
Can a deficiency judgment be wiped clear through a bankruptcy?
Thanks
Hi Guest!
Welcome to forums!
As the property is located in Florida, the lender will file the deficiency judgment in that state. If you file bankruptcy, you can include the deficient balance in your filing and get it discharged. As it's an unsecured debt, you won't have to pay it.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
As the property is located in Florida, the lender will file the deficiency judgment in that state. If you file bankruptcy, you can include the deficient balance in your filing and get it discharged. As it's an unsecured debt, you won't have to pay it.
Feel free to ask if you've further queries.
Sussane
My son and his then pregnant wife both lost their jobs in 2008. Their house in Florida was foreclosed with a final judgement in March of 2009. I purchased another house for them in Florida. They are not on the deed. As neither has been able to find more than a part-time server job they re-enrolled in school. They received a 1099 but it was not a 1099C. They need a car and obviously can not purchase one. If I buy them one and title it in both my name and my son's can the mortgage company come after the car if they sue him?
Hi Micky,
If your son's name is mentioned on the car title, then his creditors can come after the car and place a lien on it to recover their balance dues.
Thanks
If your son's name is mentioned on the car title, then his creditors can come after the car and place a lien on it to recover their balance dues.
Thanks
i,m in the foreclosure process with my property in chicago,i have a property in florida,can the servicer , ocwen w.p.b. sue me for acess to my florida property.i,m at my wits end,any help/advice welcome.pat
hoe long after foreclosure can they file a deficency judgement against a borrower,kind regards.
Hi!
Welcome to forums!
To pat,
If your lender wants to place a lien on your property in Florida, then the lender will have to file a judgment in a courthouse there. If he gets a judgment, then he can place a lien on your property located in Florida.
To Sally,
The lender will file a deficiency judgment immediately after a foreclosure sale is over. As far as the Statute of Limitations (SOL) regarding deficiency judgment is concerned, it will vary from state to state.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
To pat,
If your lender wants to place a lien on your property in Florida, then the lender will have to file a judgment in a courthouse there. If he gets a judgment, then he can place a lien on your property located in Florida.
To Sally,
The lender will file a deficiency judgment immediately after a foreclosure sale is over. As far as the Statute of Limitations (SOL) regarding deficiency judgment is concerned, it will vary from state to state.
Feel free to ask if you've further queries.
Sussane
my condo association in Florida just filed for a Status Conferance to try to finally get the bank to foreclose on my condo which I have stopped paying the the mortgage since 2 years now because of illness...they are going after the bank to pay them the maintenance fees which also have not been payed in 2 years...when and if my condo gets foreclosed can the bank go after my primary residence in Wisconson...I am not working and I`m on SSI , but since I have alot of equity in my property will they go after that?...what are my alternatives?
In order to go after your property in Wisconsin, the lender will have to file a judgment at the law court there. If the lender gets a favorable judgment, then he will be able to place a lien on your property.
Hello. My wife is a NYS resident. She owned a house in FL that was foreclosed on. The court in FL recently issued a deficiency judgment against her. They subsequently sent her paperwork to be completed that includes employment, income, and banking information requests. The attorney for the bank also wrote to her stating that if she doesn't complete the forms and return them then she would be in contempt of court. I am inclined to have my wife ignore all requests as an attorney in NY mentioned that they first need to go to court in NY to start enforcing collections.
What are the possible results should my wife ignore the courts request to complete the paperwork? Also, can they go after her wages through her employer or would they only be able to do it through her bank?
Thank you.
What are the possible results should my wife ignore the courts request to complete the paperwork? Also, can they go after her wages through her employer or would they only be able to do it through her bank?
Thank you.
Hi Guest,
It is true that the lender will have to get a judgment from the court of New York to enforce the deficiency. If the New York court fails to give a judgment in the lender's favor, then your wife won't be liable for the deficient amount. In case of wage garnishment as well, the lender will have to apply for a judgment in that regard prior to garnishing her wages.
It is true that the lender will have to get a judgment from the court of New York to enforce the deficiency. If the New York court fails to give a judgment in the lender's favor, then your wife won't be liable for the deficient amount. In case of wage garnishment as well, the lender will have to apply for a judgment in that regard prior to garnishing her wages.