One of the most worrisome aspects of a foreclosure is the risk of a hefty deficiency judgment being handed down after a home has been already foreclosed on. What this means is that if the lender is successful in foreclosing on the property, and the value that they have is appraised at is less than the amount owed, the court could grant allow the lender to place a judgment against you personally for the deficiency in the amount owing. For example, if the amount owed to the lender is $150,000, and they appraised the home at only $125,000, you could have a judgment against you for a further $25,000 after they take the property. Oftentimes this judgment leads to wage garnishing and/or bankruptcy.
Preventing a Deficiency Judgement
We recently had a client facing this very situation where his lender had gone to court requesting an Order for Sale to Plaintiff with Deficiency Judgement. We were able to help our client with successfully contesting the lender’s assessed value of the property, and as a result, no judgment will be granted. This action saved our client an estimated $20,000+ in a deficiency judgment that would have been handed down to him personally after already losing his home.
Deficiency judgments are very common in foreclosure cases where the mortgage is CMHC or Gengrowth insured, and we come across them frequently. This is yet another example of why it is so important to take proper action in a foreclosure. Through our professional experience and expertise, we are not only about to help our clients through the foreclosure process but can help them save their credit and financial future as well. If you are currently facing a foreclosure it is imperative that you address the matter right away, and get the help you need as soon as you need it. Contact us today to see how we can help.
