I have been doing short sales for just over 5 years as of this article, the two most resounding questions, based on the course of action as it relates to the foreclosure are as follows:

1. Will I owe the bank money after they foreclose on my on home?
2. If you are able to negotiate a price and buy it for less then I owe, will the bank come after me for the difference?

As a homeowner, that would be a very important question for me as well. Often, when I meet with homeowners, I always explain how the foreclosure process works. If you are not aware of the legal process in your market, you should learn. It is important that you are able to answer this question for the owner when it arises.

When the lender or bank forecloses on the property and they eventually sell the property for less than what was owed, then a deficiency exists with the loan. The deficiency is the difference between what the homeowner owed and the amount the property sold for.

For example, Mary owes $100,000 on her home and the lender forecloses and sells the property for $60,000 at auction. There is a deficiency of $40,000 for which the lender can then sue the homeowner. The key phrase is