Deficiency Judgment

DEFINITION of 'Deficiency Judgment'

A judgment made by a court against a debtor indicating that the sale on a foreclosed piece of property did not cover the outstanding mortgage in full. It is a lien placed on the debtor for further money. A deficiency judgment is not considered by the court unless the lender makes a motion for it to be granted. If the lender does not make the motion, then the court considers the money gained from the foreclosed property to be sufficient.

BREAKING DOWN 'Deficiency Judgment'

A debtor who receives a deficiency judgment may seek exemption from the lender or other creditors, file a motion to have the judgment overturned or, if necessary, declare bankruptcy. Before making any decisions pertaining to a deficiancy judgment, defendants would be best advised to contact an attorney.

RELATED TERMS
  1. Stipulated Judgment

    A court order that requires one party to pay another party a ...
  2. Charging Order

    A court-authorized right granted to a judgment creditor to attach ...
  3. Confession Of Judgment

    A written agreement signed by the defendant that accepts the ...
  4. Appeal Bond

    An amount of money placed in holding while the appeal is being ...
  5. Deficiency Balance

    The amount owed to a creditor if the sale proceeds from the collateral ...
  6. Debtor In Possession - DIP

    An individual or corporation that has filed for Chapter 11 bankruptcy ...
Related Articles
  1. Markets

    What's a Debtor?

    A debtor​ is an individual or company that owes money.
  2. Markets

    Credit And Debt Management: Debt Collection And Bankruptcy

    by Cathy ParetoIt's never a good day when a debt collector is knocking on your door. Not only is being on the receiving end of debt collection costly, it can be downright stressful and humiliating. ...
  3. Personal Finance

    How Does a Lien Work?

    A lien gives a creditor the legal right to seize and sell property, then use the proceeds to pay off a borrower’s debt.
  4. Personal Finance

    Equity Stripping Leaves Creditors Empty-Handed

    Add additional debt to your real estate assets to keep the creditors at bay.
  5. Investing

    Changing The Face Of Bankruptcy

    A 2005 law attempts to unmask fraudulent debtors and still save those who are struggling. Will it affect you?
  6. Markets

    Investing In Property Tax Liens

    Property tax liens can be a viable investment alternative for experienced investors that are familiar with the real estate market.
  7. Investing

    Avoiding Foreclosure Scams

    If you want to save your home, avoid bogus offers and take matters into your own hands.
  8. Investing

    Why Bad Credit Is Bad For Financial Careers

    In order to obtain and maintain a career in the financial industry, it is also important to have a clean credit report.
  9. Investing

    Short Sell Your Home To Avoid Foreclosure

    Are you in danger of losing your home? Protect your credit score with a real estate short sale.
  10. Insights

    Tips for Choosing the Best Online Mortgage Lender

    Finding the right online mortgage lender can be a tall task. Here's some help on how to avoid wasting your time.
RELATED FAQS
  1. What effect did the Bankruptcy Abuse Prevention and Consumer Protection Act of 2 ...

    Credit card companies and banks hate deadbeats who take from their bottom lines. They especially dislike the Chapter 7 bankruptcy ... Read Answer >>
  2. How will my ex husbands bankruptcy affect the home mortgage in our names?

    My ex and I have both our names on our mortgage loan. We were never married. He is about to file bankruptcy and I'm wondering ... Read Answer >>
  3. What factors should I consider when shopping for the best mortgage lender?

    Comparing lenders to obtain the best mortgage loan requires research and willingness to shop around for the best loan to ... Read Answer >>
  4. How long does information stay on my credit report?

    Understand how long different types of information stay on your individual or business credit report according to the rules ... Read Answer >>
  5. Why are credit cards able to charge such high interest rates compared to other lenders?

    A true financial horror story began on Halloween in 1978. On that date, the Supreme Court began hearing Marquette National ... Read Answer >>
  6. What debts can I discharge when filing for bankruptcy?

    Discover which types of debt can be discharged through a Chapter 7 or a Chapter 13 bankruptcy and which debts require an ... Read Answer >>
Trading Center