Posted by John Merchant on May 31, 2004 at 18:50:11:
If jilted 2d owner thinks the debtor has any assets, you’d better expect him to sue the defaulting debtor…only if he thinks it’s an asset-less debtor, will he then forgive and advise IRS of forgiveness for tax deduction.
Deficiency Judgements after foreclosure - Posted by JimF
Posted by JimF on May 16, 2004 at 23:19:59:
Knowing that second mortgage lien gets wiped out when the first mortgage lender forecloses, the promissory note from the second is still valid and the second lender can still proceed with a deficiency judgement for the balance owed…? And also, the first mortgage holder who forecloses and has to sell the REO can still pursue a deficiency judgement for the difference in sale proceeds vs. loan balance plus back payments, accrued interest, legal fees, commissions, etc.? In reality, I wonder how often these deficiency judgements are pursued, vs. the lenders just writing them off and reporting their loss to the IRS, generating a 1099 on the foreclosed homeowner… I’m in Colorado…