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.
Welcome santi,
If you file bankruptcy, you will receive a discharge from paying off the deficient balance.
If you file bankruptcy, you will receive a discharge from paying off the deficient balance.
Our son [a dual citizen] returned to France [from Florida] with his family in April 2008.He paid for the upkeep of the house [but not the mortage payments] until it was foreclosed on by Bank of America [11/09. Four short sale opportunities and a Deed in Lieu were ignored by the bank.
A Deed Transfer and Certificate of Sale [for $0] to Fannie Mae occured Jan 2010.Fannie Mae sold to current owner/occupant for $245,000 in March 2010. The current owner/occupant forwards his mail. Received Feb 5,2011 was a 1099-A from Fannie Mae. It shows in Box 2 $348,000, the correct amount of Principal Outstanding. However in Box 4 it shows $406,291.32 as Fair Market Value of Property
Questions
1. If sold for $245,000, how can Box 4 show $406,000+ ?
2. What does this form mean ?
3. Will a 1099-C follow ?
4. What should the our son do with the form ?
5. If Fair Market Value is more than Debt,is the debt forgiven ?
Thanks For Your Help
A Deed Transfer and Certificate of Sale [for $0] to Fannie Mae occured Jan 2010.Fannie Mae sold to current owner/occupant for $245,000 in March 2010. The current owner/occupant forwards his mail. Received Feb 5,2011 was a 1099-A from Fannie Mae. It shows in Box 2 $348,000, the correct amount of Principal Outstanding. However in Box 4 it shows $406,291.32 as Fair Market Value of Property
Questions
1. If sold for $245,000, how can Box 4 show $406,000+ ?
2. What does this form mean ?
3. Will a 1099-C follow ?
4. What should the our son do with the form ?
5. If Fair Market Value is more than Debt,is the debt forgiven ?
Thanks For Your Help
i am a paying tenant in a condo that is in foreclosure. what rights do i have with a lease for 12 months??
Hi Guest,
Box 4 shows the fair market value of the property. The sale price of the property may be different from the fair market value of the property. Form 1099a deals with the acquisition or abandonment of secured property. If the deficient balance is forgiven by the lender, then your son will receive a 1099c form. Your son will have to attach the form with his tax documents. It will depend upon the lender whether or not he will forgive the deficient balance.
To terlaak,
If the property is in foreclosure, you will receive an eviction notice from the lender, though you have a lease contract for 12 months.
Thanks,
Jerry
Box 4 shows the fair market value of the property. The sale price of the property may be different from the fair market value of the property. Form 1099a deals with the acquisition or abandonment of secured property. If the deficient balance is forgiven by the lender, then your son will receive a 1099c form. Your son will have to attach the form with his tax documents. It will depend upon the lender whether or not he will forgive the deficient balance.
To terlaak,
If the property is in foreclosure, you will receive an eviction notice from the lender, though you have a lease contract for 12 months.
Thanks,
Jerry
I sold my home last year in a short sale, the original note had two lender a first and second, the second in now trying to collect $40,000. I am on disability and do not work, I collect disabilty now and it barely covers my living espenses. Is there any way out of this situation?? Please help...
Hi Guest!
Welcome to forums!
The second lender has the rights to come after you in order to claim his outstanding loan balance. You need to contact the lender and try to settle the dues with him. You should request the lender either to forgive the balance amount or give you an affordable payment plan to pay off the dues.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
The second lender has the rights to come after you in order to claim his outstanding loan balance. You need to contact the lender and try to settle the dues with him. You should request the lender either to forgive the balance amount or give you an affordable payment plan to pay off the dues.
Feel free to ask if you've further queries.
Sussane
If my HOA forecloses on my house. Who is responsible for the mortgage after the auction?
I have a judgement on 1 credit card(Discover)
In Florida can they take a home owned by me and my girlfriend,
We live in the home and owe more than it is worth.
In Florida can they take a home owned by me and my girlfriend,
We live in the home and owe more than it is worth.
Hi mechanex,
The credit card company can place a lien on your property and may force you to sell off the property so that they can recover their dues.
Thanks
The credit card company can place a lien on your property and may force you to sell off the property so that they can recover their dues.
Thanks
Hi , Can a bank has the right to collect a rental foreclosure deficiency judgment on my homestead home which I own free and clear.
Your answer would greatly appreciated
Your answer would greatly appreciated
If you have an homestead on your property, then the lender may not be able to claim rental foreclosure deficiency judgment on that house.
Hello, I own 2 homes in Tampa. One of them is my primary residence, and the other one is used to be my primary residence, but for now I rent it to a friend of mine. At this time, I can't afford to make 2 mortgages since my cafe is slow. If I want to let go my rented home, does the lender will put a lien on my primary residence? Please I need help, and thank you for all the help.
Cindy
Cindy
Hi Cindy,
If you pay off the loan in full, then the lender won't put a lien on your primary property. You can ask your friend to buy the property and refinance the mortgage in his/her name. This will help you in getting rid of the property as well as the mortgage.
Thanks
If you pay off the loan in full, then the lender won't put a lien on your primary property. You can ask your friend to buy the property and refinance the mortgage in his/her name. This will help you in getting rid of the property as well as the mortgage.
Thanks
I am a lender from a sale of vacant lot in pasco county. The borrower has defaulted in his payment since last february so I hired a lawyer to file for foreclosure. What are my rights under the florida law against delinquent payment? What if the realtor failed to obtain PMI for under 20% downpayment so we can be protected in case of foreclosure? your advice will be highly appreciated. Thank you