What is a deficiency judgment in a foreclosure?

A deficiency judgment is a type of court order that can result from foreclosure proceedings in Texas. A deficiency judgment is issued when the foreclosure sale of a property does not generate enough money to cover the amount of debt owed to the lender. In other words, it is a judgment that holds the borrower responsible for the difference between what is owed on the loan and the proceeds of the sale. The lender can pursue a deficiency judgment after the foreclosure has concluded. To do this, the lender must file a lawsuit in court and prove that the deficiency amount is indeed owed. Upon a successful court determination, the judge may issue a deficiency judgment in favor of the lender, thereby allowing the lender to receive the amount claimed in the judgment from the borrower. If a deficiency judgment is issued in Texas, the borrower must pay the amount of the judgment within 30 days. If the borrower fails to do so, the lender can pursue collection methods such as wage garnishment or bank account seizure to recoup the money owed. Ultimately, a deficiency judgment gives the lender an opportunity to receive money owed to them from a foreclosure. It is important for borrowers to be aware of the potential for a deficiency judgment after a foreclosure and to understand the consequences of not paying the judgment in a timely manner.

Related FAQs

What is a deed-in-lieu of foreclosure?
How can I find out if I am a victim of wrongful foreclosure?
What is non-judicial foreclosure?
What is a foreclosure sale?
What are the foreclosure options for servicemembers?
Can a lender foreclose on a property without a court order?
Can I pay off a foreclosure in full?
What is a short sale in a foreclosure?
What are the legal consequences of a foreclosure?
What are the legal consequences of a foreclosure?

What is a deficiency judgment in a foreclosure?

Related FAQs

Related Blog Posts