I get asked questions about deficiency judgements almost daily by both homeowners and fellow Realtors alike.  Here are some quick bullet points concerning deficiency judgements as they pertain to foreclosure or short sales.

• Lenders in Maryland HAVE the right to pursue a deficiency judgement when a house is sold for less than the remaining mortgage balance.  Whether the house is sold at Trustee Sale (foreclosure) or Short Sale.

• Maryland laws allow lenders up to 3 years to pursue these deficiencies.
• If a homeowner pursues a short sale vs. foreclosure typically they will be able to negotiate more favorable terms.
• If a homeowner decides to let their home go to foreclosure, they may not know of any deficiency judgement for years, leaving the homeowner “in the dark”
• Most deficiency judgements can be negotiated.
• HAFA (Home Affordable Foreclosure Alternatives) program allows a homeowner to Short Sale their property and the lien holders must forgive homeowners of any deficiencies.

If you are considering a short sale, or need assistance with a loan modification or foreclosure alternative advice, contact me today.