Defending Against Deficiency Judgments

In Florida, mortgage companies have stepped up filing deficiency claims on home foreclosures due to the recent reduction of the statute of limitations from five years to one year.

Don't despair, there are defenses and most can be settled on favorable terms or defended one way or another.

  1. Challenge the appraisal or BPO of the bank (many of these use inapplicable information);
  2. Challenge jurisdiction of the Court (service by publication, entry of initial foreclosure judgment in error for instance, your current county or state
  3. of residence);
  4. Prior deficiency waiver overlooked or ignored;
  5. Miscalculations of interest;
  6. The party suing you may not have standing or the documents needed to prove ownership of the deficiency claim;
  7. The lender may have sat on its rights too long, or failed to pursue an insurance claim to reduce the amount owed;
  8. Consumer laws may provide some protection against unlawful debt collection; and lastly
  9. Take action to protect your assets or at least eliminate low hanging fruit such as garnishment of bank or brokerage accounts.
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