When can deficiency judgments occur in Connecticut?

Connecticut law Chapter 846 Section 49-14 governs deficiency judgments Connecticut. These laws limit the power of filing a deficiency judgment.  Lenders are required to file deficiency judgments not more than thirty (30) days after the right of redemption period has expired.  Specifically worded Section 49-14 states: “At any time within thirty days after the time limited for redemption has expired, any party to a mortgage foreclosure may file a motion seeking a deficiency judgment."

What this means to homeowners facing foreclosure

Homeowners who are facing foreclosure may have a deficiency judgment placed against them after their rights of redemption have expired. Rights of redemption in Connecticut must be exercised before the date of the foreclosure sale. However, Connecticut law states that a judge may not chose to force a sale of a property.  Connecticut states that a judge may order the homeowner to turn the deed over to the lender (e.g. deed in lieu) and not order the property sold.

How foreclosure sale is avoided

There are two types of foreclosure in Connecticut - strict foreclosure and foreclosure by sale.  Foreclosure by sale is approved by the court when the property valuation is more than the amount that is owed to the lender. This means that the slimmest amount of "equity" is likely to result in a foreclosure sale.  If a property is sold at a foreclosure sale (by order of the court) it may result in a Connecticut deficiency judgment.

Know your rights

Any and all parties to foreclosure have the right to request a property appraisal. If the property appraisal shows that the property is worth less than what is owed, you may be able to avoid a deficiency judgment in Connecticut.