What is a personal judgment against a borrower called when foreclosure sales do not cover the full mortgage debt?

A personal judgment against a borrower when foreclosure sales do not fully cover the mortgage debt is referred to as a deficiency judgment. This legal determination occurs after a foreclosure sale where the property is sold, but the sale proceeds are insufficient to pay off the remaining mortgage balance.

In many jurisdictions, a lender may pursue a deficiency judgment to recover the remaining amount owed by the borrower, effectively allowing them to seek additional compensation beyond the foreclosure sale. This scenario typically arises in situations where the property value has declined significantly. A deficiency judgment serves as a legal recognition of the borrower's obligation to repay the lender for the shortfall.

Understanding deficiency judgments is crucial in real estate and lending as it influences the borrower's financial liability post-foreclosure and highlights the importance of evaluating the risks associated with mortgage lending and property valuation.