What is a foreclosure deficiency judgment?

A foreclosure deficiency judgment is legal action taken by a lender or mortgage holder when a borrower defaults on a mortgage loan and the lender is unable to fully recover the remaining balance of the loan through the foreclosure proceedings. In Arizona, if a lender decides to pursue a deficiency judgment, the borrower must be served with notice in writing. When the lender pursues a deficiency judgment, they are suing the borrower in court for the unpaid balance of the loan. The court will then enter a judgment against the borrower for the difference between the remaining balance of the loan and the amount of money the lender was able to recover in the foreclosure. This is known as the deficiency judgment. The lender can then use a variety of methods to collect the remaining balance of the loan, including wage garnishment or the seizure of property. It’s important to note that in Arizona, a lender can only pursue a deficiency judgment within one year of the completion of the foreclosure process. After the year has passed, the lender cannot pursue a deficiency judgment. Foreclosure defense law in Arizona allows homeowners to challenge a lender’s efforts to pursue a deficiency judgment. A potential defense may be that the lender did not follow proper foreclosure procedures, resulting in an unfairly high debt. For this reason, it is important for homeowners facing foreclosure to seek legal representation as soon as possible.

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What is a foreclosure deficiency judgment?

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