Posted on: 05th Mar, 2010 08:32 pm
Does Michigan use fair value of the property when determining the deficiency judgement? Or do they just use the balance left after the foreclosure sale of the property to determine the deficiency judgement?
Hi curious,
The deficiency is the difference between the mortgage balance you owe and what the property sells for at the foreclosure auction. Thus, if you owe $80k and it sells for $30k, you will be liable for a deficiency of $50k. The lender may come after you to recover this deficiency and may get a judgment against you if the foreclosure is a judicial foreclosure and the loan is a recourse loan.
The deficiency is the difference between the mortgage balance you owe and what the property sells for at the foreclosure auction. Thus, if you owe $80k and it sells for $30k, you will be liable for a deficiency of $50k. The lender may come after you to recover this deficiency and may get a judgment against you if the foreclosure is a judicial foreclosure and the loan is a recourse loan.