Nobody wants to go through foreclosure.
In the foreclosure process, if the sale of the home does not yield enough money to pay off the mortgage that a lender had given the homeowner, the homeowner could be on the unfortunate end of a deficiency judgment, having to repay the difference between the balance owed on the mortgage and what was received in the sale.
According to Ilyce Glink, nationally-syndicated columnist, bestselling real estate book author and Newstalk 750 WSB radio talk show host, state laws differ on this – in some states, lenders can go after a homeowner for the deficiency judgment. In others, lenders cannot. But in reality, lenders may not be willing or able to take any further action against a homeowner, even in a state that allows deficiency judgments, especially when it costs the lender time, money and other resources going after people with no assets. Right now, lenders are trying to move on and are leaving homeowners with their damaged credit.
Whether or not a lender goes after a homeowner for a deficiency judgment, the homeowner will face an extremely negative impact on their credit score and history.
Glink offers financial advice at www.ThinkGlink.com. She will be presenting, “How to Profit from Foreclosure,” a seminar for real estate investors and prospective home buyers on a housing market recovery driven by the purchase of foreclosed properties October 24 at the Renaissance Waverly Hotel in Atlanta. Use discount code AREF for a 25% discount off registration.