Here is an important question:

Our home was sold just a few days ago. We are trying to see whether we should be anticipating a deficiency judgement. From what I’ve gathered deficiency judgments are not being pursued on primary residences. How true is this? and what are the chances of it happening?

My Answer:

In Illinois, the lender has the right to pursue a deficiency judgment. Some lenders have been pursuing them. It is impossible to predict if your lender will do that. However, it is important that you consult with an experienced attorney to review the judgment, and the foreclosure case to review it to see whether they are pursing the deficiency. Also, if you had more than one mortgage (such as a home equity loan), that lender will almost always pursue a deficiency judgment. It is important to protect yourself, because if you are working or own property later, that lender can decide to pursue the deficiency judgment at a much later time.

A deficiency judgment is a court order saying that the homeowner has to pay the difference when the house is sold for less than what is owed, after it is sold at a foreclosure auction. So, for example, if you owe $200,000.00 on your house, and it sells for $125,000.00 at the auction, the deficiency would be $75,000.00.

It is important to consider all of your options when your house is in foreclosure. We can explain all of your options, and help you decide the best way to protect yourself.

Daniel J. Winter
BankruptcyLawChicago.com
312-789-9999
Offices in Chicago, Gurnee, Oak Lawn, and Skokie, Illinois