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

After a foreclosure in Virginia, the remaining balance of the loan is known as a deficiency balance. This balance is the amount that the homeowner still owes the lender after the home was sold through foreclosure. The foreclosure sale usually does not cover the full amount of the loan, so there still may be a deficiency balance. The lender may choose to pursue the homeowner for the remaining balance. This may manifest as a lawsuit, or it may be a demand for payment. If the lender pursues the homeowner, it is important to consult an attorney to understand the legal options available to you. In some cases, the lender may choose to forgive the deficiency balance. This is not common, and is usually a business decision on the part of the lender. In some cases, the lender will agree to forgive the balance in exchange for the immediate payment of a portion of the balance. It is important to understand that after a foreclosure in Virginia, the deficiency balance is still due. Even if the lender chooses not to pursue it, the balance is still due. If the deficiency balance is not paid within 10 years, the lender may become barred from collecting it. However, it is best to consult an attorney when dealing with foreclosure law.

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

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