Compare Mortgage Quotes

sportscarvell · Joined: 26 Jan 2010 Posts: 8 2.83 Dollars($)

I am asking this question for a friend: He is facing layoffs at a job but feels he will survive. He wants to buy a house in S.C., but if he loses his job worries about foreclosure and even more about a deficiency judgement to go after his other assets. Has anyone heard any stories about deficiency judgments with FHA loans? Thanks

jenkin7 · Posted: Thu Jan 28, 2010 3:01 am Post subject:

Hi sportscarvell,

It depends on an individual lender if they would pursue deficiency judgment against the borrower. There's no such rule that eliminates the chances of a deficiency judgment on an FHA loan. However, lenders generally pursue deficiency judgment on an FHA loan if the mortgagor is a non-occupant borrower or if he has walked away from the property or if the borrower previously defaulted on an FHA loan. Your friend can look for loss mitigation options like a loan modification or a deed in lieu to avoid a judgment.

sportscarvell · Joined: 26 Jan 2010 Posts: 8 2.83 Dollars($)

So, in other words, you are saying that an FHA loan is about equal to a Conventional loan when it comes to protection from a deficiency judgment? Thanks so much for taking time to answer. Mahalo!

Guest

Wheather or not fha will seek a judgement or a lender , will depend on which state you live in. Most states are non-recourse states, and a non- judicial forclosure would be free of judgements in a non-recourse state. A judicial foreclosure is not as attractive for a lender because of the expense involved.

Company	Loan Type	APR	Est. Pmt.
				Go
				Go
				Go
				Go
				Go
				Go

Compare Mortgage Quotes

Are you protected from deficiency judgement with FHA Loan?

Bookmark this page

Helpful References

Calculators

Financial Tools

Our Community

Community Rewards

Followers (252)

455 People like Mortgage

Property State:
Property Type:
Credit Rating:

All times are GMT - 7 Hours

Page 1 of 1