The Ramifications of Foreclosure

Individuals who are facing foreclosure should be aware of the possible ramifications associated with it. A common misconception surrounding foreclosure is that once your house has been auctioned off you are free of all debt to the bank or lender. In Florida, this is not true, as there can be other financial liabilities that you will still be held to, especially if your home is sold at a deficiency. If you are threatened with foreclosure, you must contact a Sarasota foreclosure defense attorney to discuss the ramifications and how to avoid future serious financial damage.

The three most common ramifications of a mortgage foreclosure are deficiency judgments, tax liabilities and a drastic drop in credit score. Deficiency judgments consist of the amount of your mortgage sale of your house. If you owed the bank $10,500 and your house sold for only nine thousand dollars, then you can be held responsible for a deficiency judgment for $9,500. The bank could take legal action to sue you for this difference. Tax liabilities are tied to debt forgiveness. If a bank decides to forgive any portion of the unpaid debt, then you will be free from paying it back - however, the amount of debt forgiven can still be taxed as income by the federal government. Lastly, your credit score will be significantly affected if a mortgage foreclosure is completed. How these matters are resolved is of great concern to many homeowners who are dealing with an underwater mortgage, and are now obligated to paying for a property that has plummeted in value.

Get Legal Protection

You need to do everything you can to defend yourself during this turbulent time. A threat of foreclosure can throw you into a spin of confusion, trying to determine whether you should just walk away, or whether other alternatives should be sought. Protecting your future financial health and credit rating are issues that should be addressed with the help of a qualified legal professional that has a depth of knowledge in the area that will best serve your interests. Sheryl A. Edwards, a Board Certified Real Estate Expert, has been in practice for over 28 years, and has helped many clients resolve a threat of foreclosure successfully. We have educated countless clients on the ramifications of foreclosure and the legal options to fight back. We will do everything possible to assist you in resolving a foreclosure, and to help you avoid filing bankruptcy. We consider this a last resort, and there are likely other extremely workable options that could be undertaken, allowing you to move on with your life without long-term consequences.