QUESTION

Can the same creditor get a wage garnishment after the foreclosure is over?

Asked on Mar 20th, 2012 on Bankruptcy - Missouri
More details to this question:
When the house goes back to the bank in foreclosure, what will happens to the lien? The lien can't be paid because NO equity. Can the same lien (creditor) get a wage garnishment after the foreclosure is over?
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5 ANSWERS

Chapter 7 Bankruptcy Attorney serving Clinton, MS at Timothy Kevin Byrne Attorney at Law
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Yes.
Answered on May 30th, 2013 at 7:50 PM

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Commercial Bankruptcy Attorney serving Davie, FL at Law Office of Jeffrey Solomon
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They can go back to court to obtain a deficiency judgment. After they obtain this money judgment they can try to collect.
Answered on Mar 23rd, 2012 at 5:38 PM

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Jeffrey Marc Siskind
Yes, if the lender is awarded a deficiency judgment.
Answered on Mar 21st, 2012 at 5:50 PM

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Kevin Elliott Parks
The short answer is that it depends, but likely the answer is yes. If you're under water, a foreclosure by your mortgage lender would typically extinguish the lien and all junior encumbrances on the property (any second mortgages, HELOCs, etc.), but that doesn't satisfy the debt you owe to the other creditor. So while their lien on your property is gone, the debt remains unsatisfied. Thus, they can likely continue to try to collect on the debt in any number of ways, including through garnishing your wages. There are a number of facts your don't include (such as the underlying nature of the debt) that may affect the creditor's rights in pursuing payment, so you may want to talk to a consumer law attorney in your area about how to deal with the situation, especially if the creditor proceeds to garnish your wages or levy your bank account(s).
Answered on Mar 21st, 2012 at 4:02 PM

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Estate Planning Attorney serving Kansas City, MO
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Yes, the foreclosure by the first mortgage will eliminate the second creditor's lien on the real estate, but they can still sue on the promissory note, and after obtaining a judgment can garnish wages.
Answered on Mar 21st, 2012 at 3:53 PM

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