In a home foreclosure do you still have to pay the

[yikes]

difference between your mortgage balance and sale amount? In Michigan?

[acermill]

In most cases, yes. The lender may hold you liable for the deficiency, file a judgment against you, and use whatever legal means they can to recover the shortfall. Some lenders engage in this practice directly, and others will sell your debt for pennies on the dollar to a collection agency, which will then pursue you for the deficiency in the same methods.

[LossMitigation]

In the last few years the major lenders are not looking for a deficiency judgment, they will send you a 1099 for earned income. That is sent out once a short sale is funded and part of the closing procedures for a short sale.

[Tabitha C]

It depends on the mortgage company, if they decide to try sale your property as a short sale, they will write you a letter letting you know, however read it carefully it may state in the letter that they will be billing you for the remaining balance , or it may state that they are charging the balance off.

[JUST ME]

Depends on your state. Some states do not permit a deficiency judgments in foreclosure . Check with an attorney in your state.

[satarnag]

Hi, the real answer is dependant on both your state and lender. For example, in California, we are a trust deed state and therefore, the lenders are not able to get judgements against us should they take a loss on the foreclosure. Their only recourse, should they use it, is to report the loss to the IRS by doing a 1099, in which you have to pay taxes on the money lost.

It is dependant on your lender as to what they do based on state laws and the options available to them, such as if they were able to recover the loss by their insurance.

Regards

[Lew-V]

Actually, the real answer depends on the type of loan it is, a purchase money loan or a refinance (in California). the lender is prohibited from a deficiency judgement if it is a purchase money loan, but very well may come after you if it is a refinance loan.