You may believe that when your mortgage lender forecloses on your home, your legal ordeal is over and you can simply walk away and start the process of rebuilding your finances. Unfortunately, Florida is one of several states that allow something called a deficiency judgment. A deficiency judgment lets your mortgage lender come after you to obtain money to cover any outstanding money due that is above and beyond what they collected from a foreclosure sale.
Deficiency judgments can have a major adverse impact on your finances as you will not only have a judgment on your public record, but you will also be expected to pay money to the lender — money that you very likely do not have.
At the Law Offices of Evan M. Rosen, our Florida foreclosure defense lawyers represent clients during foreclosures or when pursuing foreclosure alternatives to try to make sure that there is no action for a deficiency judgment. If you have already had your home foreclosed on, we also have experience fighting deficiency judgments as well as resolving those issues through bankruptcy or other means.
No matter what stage of the foreclosure process you are in or whether you already have a judgment against you, our aim is to put your needs first and help you to resolve your case with your mortgage lender once and for all. Our firm philosophy is, above all, to provide you with strong legal advocacy and to explore all available solutions so that you can have the best resolution possible in a tough situation.
You are welcome to read more about deficiency judgments below or you can contact us now for a FREE CONSULTATION by calling 754-400-5150 or by filling out our online form.
Understanding Deficiency Judgments
States are divided into “recourse” states and “non-recourse” states. Florida is a recourse state, which means that a mortgage lender has the option to take legal action if the money obtained in a foreclosure is not enough to pay all money owed. For example, if you owe $100,000 on your home and the house, at the time of the foreclosure sale, is only worth $80,000, the lender who foreclosed is still owed the $20,000, plus the costs of foreclosing. A deficiency judgment allows the lender to get a judgment against you for this balance — in this case, the $20,000 plus costs.
A mortgage lender has up to five years after the foreclosure sale to pursue a deficiency judgment. Most lenders will pursue these judgments immediately as part of the foreclosure action, but it is also possible for lenders to file a separate lawsuit with the court and for a separate trial to be conducted where the lender has the burden of proving the amount of the deficiency.
If the court determines that the mortgage lender did lose out, the court will find for the lender and issue a judgment against you. This judgment can stay on your public record for up to 20 years. During this time, it can disqualify you from certain jobs where you need a clean financial background. It can also make it more difficult, if not impossible, to get credit at a good rate, especially in the years after the judgment happened.
In addition to having the judgment on your record, you will also have to pay the judgment. If you do not pay, then additional legal action might be taken including, in some cases, garnishment of your wages and/or loss of possession of your personal property pursuant to a writ of execution and levy.
What to Do About Deficiency Judgments
Whenever possible, it is a wise choice to take steps to prevent deficiency judgments before your foreclosure action is final. At the Law Offices of Evan M. Rosen, our foreclosure defense attorneys will help you to explore alternatives such as obtaining a waiver of deficiency as part of a deed in lieu of foreclosure, consent judgment or a short sale. Not only can these resolutions help you to avoid a deficiency judgment, but they may also be better for your credit and you could walk away with cash through various incentive programs intended to encourage people to pursue foreclosure alternatives.
If you have already had your home foreclosed on and the bank is pursuing a deficiency judgment, the Law Offices of Evan M. Rosen can represent you in the court action that the lender must pursue to obtain the judgment against you. There are defenses pertaining to the valuation of the property at the time of sale which the firm has successfully used to defend other homeowners.
Finally, if the court has already issued a deficiency judgment against you, we can assist you in exploring alternatives to resolve that judgment as effectively as possible. Alternatives may include settlement of the judgment or bankruptcy, depending upon the entirety of your financial circumstances.
Contact Our Florida Foreclosure Defense Attorneys Today
No matter what your situation, we will listen to you, review your case and put our commitment to service first. Our aim is always to work with you to find the best resolution and to provide you with strong legal advocacy at an affordable price. Contact us today at 754-400-5150 or through our online form to schedule a FREE CONSULTATION to learn more.
Our country’s history is filled with examples of people who have struggled financially but then have gone on to become famously wealthy. They all reclaimed their part of the American Dream, and we want to help you reclaim yours! Let the lawyers and staff of the Law Offices of Evan M. Rosen serve you!