Short Sales – What Happens To The Unpaid Loan Balance After The Sale?

Many people who think they’re doing a short sale will want to know what’s happening after selling with the unpaid loan balance. After a short sale, the lender can pursue a deficiency judgment against you.

An assessment deficiency occurs only when the bank sued the borrower’s loan balance unpaid after the short sale and won a court case. You can apply to Australian lenders that can accept borrowers for home loan with unpaid defaults in Australia.

Despite the possibility, after a short sale, mortgage lenders seldom seek deficiency votes against the borrower because the procedure is costly and time consuming.

Image Source: Google

If the document is not properly filed the lawsuit, the actual deficiency judgment could be reversed. In addition, from the perspective of the banks, if you have the money to pay the deficiency judgment, you probably will not be missed on your mortgage payments in the first place.

Before the short sale is completed, the bank sometimes ask the homeowner is better to do one-time payment at the closing table or receive unsecured promissory notes for some or all of the unpaid debts forgiven.

Such as collection calls, this is another attempt by the banks to reduce losses. Bank representatives sometimes use scare tactics by telephone to threaten or intimidate the borrower.

Aggressive collection agencies have been known to lie in a desperate attempt to get more money from the borrower.

So, how will you know what your bank will do with the unpaid loan balance after a short sale? You can contact your lender and ask them to do this or just write request directly to the sales contract you sign with a buyer to buy your property.

Leave a Reply

Your email address will not be published.