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If a home sold as a mortgage foreclosure does NOT bring an amount sufficient to satisfy the outstanding mortgage debt, the mortgagor may be responsible for

A)
a deficiency judgment.
B)
punitive damages.
C)
a default judgment.
D)
liquidated damages.

User Bharatesh
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1 Answer

7 votes

Final answer:

In mortgage foreclosure, if the sale doesn't cover the debt, the borrower may face a deficiency judgment, which is the remaining balance of the mortgage after the property is sold.

Step-by-step explanation:

If a home sold as a mortgage foreclosure does not bring an amount sufficient to satisfy the outstanding mortgage debt, the mortgagor may be responsible for a deficiency judgment.

This occurs when the foreclosure sale does not generate enough funds to cover the mortgage balance, and the lender seeks a judgment against the borrower for the remaining debt. This was a critical issue during the housing bubble burst when property values plummeted, leaving many homeowners with mortgages significantly higher than the value of their homes.

User Drasill
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