As a homeowner that has fallen into great financial difficulty, you may find that you are faced with a foreclosure on your home. What can often happen is that your home is sold through a foreclosure but not for enough that is going to clear off the entire mortgage balance. This means that you are now without a home but still have a mortgage debt.

If you did not consider a bankruptcy before your foreclosure you may want to seek the advice of a qualified bankruptcy attorney to find out how to best deal with this mortgage deficiency judgment. What you have to realize is that your mortgage was a secured debt meaning that your house was held as collateral against it.

The laws pertaining to this will differ according to the various states. There are a lot of factors at that are going to come into play as to whether the lender can come after you for the deficiency. It will depend on whether it is a first mortgage or a junior lien and whether you actually used the mortgage loan to purchase the home. It will also depend on whether it is a recourse or non recourse loan.

In some states, mortgage lenders are not allowed to pursue a mortgage deficiency at all. What you want to do is speak to a bankruptcy attorney who can best advise you as to whether going bankrupt would be your best recourse for handling this deficiency. The repercussions of not doing so could be quite serious. Again it depends on your state, but you could end up having your wages garnished or liens put against your other assets in order to pay this judgment if it is not dealt with.

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