What does it mean to be in an anti-deficiency state?


What is the meaning of “anti-deficiency” and what is the implication to a seller considering a short sale? How does one find out whether he/she is in an anti-deficiency state?

asked August 10, 2011

1 Answer


Being in an anti-deficiency states means that states supports anti-deficiency laws. In short this means that there is a state statute that prohibits lenders from suing borrowers for deficiencies, which is the difference between the amount owed on a mortgage and the sale price at which a house is sold at Trustee Sale or Foreclosure Auction. Anti-deficiency laws typically provide no protection for second or third mortgages, home equity lines of credit, and mortgages secured by investment properties.

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