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Although lenders rely on the foreclosure process when homeowners default on their loans, the reality for many people is that the amount on these loans is higher than the full value of the property. In that case, a deficiency remains. Borrowers still owe this deficiency even when they are no longer in possession of the property.
If you are facing a deficiency on your home loan, you could benefit from a discussion with an experienced attorney. It could be possible to defend against this type of legal action or take other steps to avoid financial hardship. Let a Fort Lauderdale deficiency judgment lawyer with All Florida Real Estate Lawyers advise you on your options.
The process of foreclosing on real property gives the lender the opportunity to reclaim real estate if the owner fails to keep up with payments. However, homes that are sold during foreclosure sales do not always recover the full amount remaining on the loan. In this situation, the lender is still owed money despite having sold the property. This dollar amount is referred to as a deficiency. The lender has the right to seek a court judgment for this amount from the borrower.
A deficiency lawsuit is similar to most other suits regarding unpaid debts. In some cases, the lender must file an additional lawsuit after the foreclosure process has been completed. In other cases, the lender could make the deficiency judgment a part of the foreclosure case. Once a lender secures a deficiency judgment, they could use several means to collect, including garnishment or levies, which a Fort Lauderdale attorney could fight back against.
The court ultimately determines the value of the deficiency judgment at trial. A judge has some leeway to determine the amount that is owed by the borrower, if any. However, a judge will typically not enter a judgment for more than the remaining loan balance.
When it comes to deficiency judgment lawsuits that are not included in the foreclosure action, the lender faces a limited amount of time to file suit. Just like with any civil lawsuit, cases pursuing deficiency judgments must comply with the statute of limitations.
According to the law, the lender has one year to seek a deficiency judgment from the borrower. This one-year period begins to expire on the day the court clerk formally issues the certificate of time to the party that purchased the home at the auction. The statute of limitations for a deficiency judgement could differ for properties with multiple units, making it important to discuss this issue with an experienced Fort Lauderdale attorney.
The failure to comply with the statute of limitations could be fatal to a deficiency judgment claim. For that reason, it can be one of the strongest defenses available to you.
If you are facing a deficiency balance following foreclosure, there are options that could help you avoid additional financial hardship. Our attorneys can provide you with useful guidance on your options.
Let a Fort Lauderdale deficiency judgment lawyer help you protect yourself and your legal rights. Call All Florida Real Estate Lawyers for a private consultation today.
