Can the lender come after you for the rest? Deficiency judgments in Wisconsin

Deficiency rules in Wisconsin, point by point

• The lender must demand it in the complaint

  When the case is filed

  The lender may demand a deficiency judgment in the complaint against everyone personally liable for the debt. The judgment of foreclosure orders it, and it is separately entered against you on or after confirmation of the sale.

  Wis. Stat. § 846.04(1)

• A waiver means no deficiency

  If the complaint waives it

  For an owner-occupied home of one to four units on 20 acres or less, if your mortgage agrees to this option, the lender can elect in the complaint to waive any deficiency. Then no deficiency judgment can be ordered or entered, the sale can happen sooner, and you may stay in the home until the sale is confirmed unless you abandon it.

  Wis. Stat. § 846.101(1), (2)(a)

• Notice of the confirmation hearing

  At least 5 days before the hearing

  Parties who appeared in the case must get notice of the confirmation motion at least 5 days ahead. The notice must state the judgment amount, the sale price, and the amount of personal judgment the lender will seek against each person.

  Wis. Stat. § 846.165

• Fair value must be credited

  At confirmation

  If the home sells for less than the debt and costs, there is no presumption that it sold for fair value. The court may not confirm the sale or enter a deficiency until it is satisfied the fair value has been credited. Bring evidence of value, such as an appraisal or your tax assessment, to the hearing.

  Wis. Stat. § 846.16(2m)(ae)

• Short sale or deed in lieu

  Before you sign

  Chapter 846 deals with deficiencies after a foreclosure sale. We did not find a Wisconsin statute with deficiency rules for a short sale or deed in lieu, so the written agreement controls. Ask the lender to waive any remaining balance in writing.

• How long a deficiency judgment lasts

  Lien 10 years; action within 20 years

  A docketed judgment is a lien on your real estate in that county for 10 years, but not on homestead property that is exempt from execution. An action on a judgment can be brought within 20 years. For a home that was in farm use, a shorter 10-year limit applies to the deficiency judgment.

  Wis. Stat. §§ 806.15(1), 893.40, 846.04(2)

The short answer in Wisconsin

Common questions in Wisconsin