With the crash of the economy in 2008, came an inundation of home foreclosures and short sales. While this is devastating in itself, those that live in judicial or recourse states are shocked to find out that they remain liable for any deficiency balance that remains. A deficiency balance occurs when a home is foreclosed on, and then is auctioned off and the monies from the auction do not cover the balance of the mortgage. This remaining balance not only becomes a deficiency owed, it can become a deficiency judgment which will lead to a bank levy and/or a wage garnishment. The following article from LoanSafe.org outlines the process, and provides you with information on whether you could be affected.
Read More Here: http://www.loansafe.org/deficiency-judgments-101
This article breaks down ways to avoid a deficiency judgment. One of the options that they provide is for the former homeowner to negotiate with the lender. While some may be savvy enough to do this and feel that it is a good option, you should consider consulting with an attorney. An experienced debt settlement attorney will be able to negotiate for a large reduction on the deficiency balance and provide you with the legal protection that you deserve. Look for a debt settlement attorney in your area that focuses the majority of their practice in this specific area of law.
Author: Kevin Fallon McCarthy