What is a deficiency judgment in a foreclosure?

A deficiency judgment in a foreclosure is a legal action taken by the lender in Washington to recover the full remaining balance of a mortgaged property that is in foreclosure. In Washington, once a home is sold in foreclosure, any remaining balance on the loan is the responsibility of the borrower. The lender can obtain a deficiency judgment as a way to collect the remaining balance if the proceeds of the foreclosure sale are not enough to cover the balance of the loan. The process for obtaining a deficiency judgment in Washington begins with the lender filing a Motion for Deficiency Judgment with the court that approved the foreclosure. The court will then hear arguments from both the lender and the borrower. The court will make a ruling and if a deficiency judgment is approved, the court will determine an amount that the borrower must pay to the lender. The deficiency judgment cannot exceed the amount of money owed on the property at the time of the foreclosure. The borrower must then either pay the amount determined by the court or file an appeal. It is important to note that once a deficiency judgment is approved, the borrower is legally obligated to pay it, regardless of the outcome of any appeal. In some cases, lenders may decide to forgive the remaining balance and not pursue a deficiency judgment. If the borrower fails to pay a deficiency judgment, the lender may take action to garnish wages or place a lien on other property.

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