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Can a lender place a lien on my Florida house for a Tennessee foreclosure deficiency?

Can a lender place a lien on my Florida house for a Tennessee foreclosure deficiency?

Q: What states do not allow deficiency judgments?

Several states do not allow deficiency judgments, including California, Arizona, and Nevada. These states have laws that prevent lenders from seeking a deficiency after a foreclosure sale. However, laws can vary significantly, so it's advisable to consult local regulations for the most accurate information.

Full question:

If my lender forecloses on my Tennessee house, can the lender put a lien on my Florida house for the loan deficiency of the Tennessee house?

Category: Real Property
Date: 04/07/2025
State: Florida

Answer:

If a deficiency judgment is permitted and obtained, the lender can file that judgment in another state, including Florida. However, if you have homestead rights in Florida, the enforcement of the lien may not violate those rights.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

Does a foreclosure wipe out all liens in Florida?

In Florida, a foreclosure can eliminate certain junior liens, such as second mortgages or home equity lines of credit, but it does not automatically wipe out all liens. Senior liens, like a first mortgage, remain in effect. Additionally, any liens that are not addressed in the foreclosure process may still be enforceable. It's important to consult a legal professional to understand how specific liens may be affected by foreclosure.

Are deficiency judgments prohibited?

Deficiency judgments are not universally prohibited. In many states, including Tennessee, lenders can pursue deficiency judgments after a foreclosure if the sale of the property does not cover the outstanding mortgage balance. However, some states have laws that limit or prohibit these judgments. It's essential to check the specific laws in your state regarding deficiency judgments.

What states do not allow deficiency judgments?

Does Tennessee allow deficiency judgments?

Yes, Tennessee does allow deficiency judgments. After a foreclosure, if the sale price of the property is less than the amount owed on the mortgage, the lender may seek a deficiency judgment against the borrower for the remaining balance. This process is governed by Tennessee law, which outlines how and when lenders can pursue such judgments.

In which scenario would a deficiency judgment be allowed?

A deficiency judgment may be allowed when a property is sold at foreclosure for less than the outstanding mortgage balance. If the lender can prove that the sale did not cover the debt, they can seek a deficiency judgment against the borrower. This typically occurs in non-recourse states or when the borrower has not been released from liability for the loan.

What liens remain after foreclosure?

After a foreclosure, senior liens, such as first mortgages, typically remain intact. Additionally, property tax liens and certain government liens may also survive the foreclosure process. Junior liens, such as second mortgages, may be wiped out, but it's crucial to review the specific circumstances of the foreclosure to determine which liens are still enforceable.