What happens to the balance of my loan after a foreclosure?

After a foreclosure in the state of Florida, the balance of a loan may become the responsibility of the homeowner. When a property is foreclosed upon, the remaining loan balance is determined by the amount the property is sold for in the foreclosure sale, minus any liens, costs, and fees associated with the sale. If the amount of the loan exceeds the proceeds of the sale, the homeowner is responsible for the difference, known as the deficiency balance. The homeowner is then legally obligated to pay the lender the deficiency balance as determined by the foreclosure sale. If the homeowner does not pay the deficiency balance, the lender has the right to take legal action in the form of a lawsuit to recoup the remaining loan balance. If successful, the lender could place a lien on any other properties owned by the homeowner, garnish wages, or place a levy on bank accounts. It is important to note that if the lender fails to pursue the deficiency balance, the homeowner is released from the debt obligation, however, this is rarely the case. Because the details of the foreclosure process vary from case to case, it is important for homeowners to discuss their situation with an experienced attorney.

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What happens to the balance of my loan after a foreclosure?

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