MenuIn essence, money judgments are final orders entered by courts that a defendant in a lawsuit owes a certain sum to the plaintiff. They represent a particular stage of the life of a debt, and might arise from all manner of debts. Consumers are most often faced with judgments when a credit card lender or utility company successfully sues to collect an amount owed, an auto lender obtains a judgment following repossession of car worth less than the money owed, or a mortgage lender obtains a judgment following a foreclosure that fails to pay off the loan. The latter two are known as "deficiency judgments" and on the occasions that they are obtained, often surprise the debtor who thought losing their house or car was the end of that debt.
Deficiency Balance
A deficiency balance exists when a secured creditor liquidates their collateral (e.g. forecloses a house or repossesses and sells a car), but the proceeds of the sale bring less than the debt owed. In many cases, the creditor can seek to recover the balance of the debt as a deficiency. A deficiency balance is one major type of unsecured debt, generally subject to discharge.
Synonyms:
Deficiency
