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What is a deficiency judgement?

If you do a short sale for less than the balance of the mortgage the difference between what the seller owed and what the property sold for is the “deficiency”. In Florida, lenders/banks have the right to sue sellers/borrowers for this amount whether the property is foreclosed, short sold, transferred by deed in lieu etc. A short sale needs to address the deficiency. A mere lien release is not a waiver of deficiency and the waiver of the deficiency is the main goal of any short sale or foreclosure alternative. Many property owners sold at the direction of real estate agents only to find out that the deficiency was never waived. The short sale approval letter must expressly state that all deficiency rights are waived and if there are HELOCS or second mortgages letters from these lien holders must also be obtained and must also waive the deficiency. Lenders do not have to waive the deficiency.

Contact Tiller & Rivera Law P.A. today to discuss your short sale options with West Palm Beach short sale lawyer and real estate attorney.
Main Office: West Palm Beach Satellite Offices: Stuart Palm Beach Gardens Fort Lauderdale

Short Sales


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