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Deficiency Judgement Statute of Limitations in Maryland?

Discussion in 'Deed in Lieu of Foreclosure - Do You Need Help to ' started by alexgolden, Nov 9, 2012.

  1. alexgolden

    alexgolden LoanSafe Member


    I am so stressed right now - we have saved quite a bit after deciding to strategically default back in 2010 and they have yet to foreclose! This has been a crazy two years and I've had a cloud hanging over me every single day. My credit score was in the high 700s before I stopped paying and now I'm at ~670. We've moved out of state and are renting but I'd like to buy a house eventually.

    When I read that MD has a 3 year statute of limitations on the deficiency judgment I assumed that meant from the time of foreclosure but after reading some of these threads I see that some (all? please let it be all?) contracts/states start the clock ticking at the time of default. In my case this is July 2010. I hesitate to ask since I hate to be excited for nothing but does anyone know whether the clock starts ticking in MD on the day of foreclosure or on the day of default?

    If someone can show me that it is the day of default I think I will sleep better than I have in probably over 5 years knowing that the SoL is less than 9 months away... (I would have an exclamation point there but I have to keep my hopes lowered in case I'm reading this wrong...)

    Thanks for any help anyone can give!!

  2. pollyanna

    pollyanna LoanSafe Member

    I'm almost afraid to answer your question, given your level of anxiety. :(

    If the lender decides to foreclose and seek a deficiency judgment, the SOL begins from the day the court issues a final ratification of the auditor's report. (So, some time after the sale.) However, a lender's options are not restricted to foreclosing and seeking a deficiency judgment. The lender (usually the second) has the option of suing on the note OR through the Deed of Trust (those DoTs signed under seal and providing the terms of the debt, i.e., the amount of the debt and when due). In general, the note (without a signature under seal) has a 3 year SOL and the DoT (meeting the aforementioned requirements) has a 12 year SOL.
  3. alexgolden

    alexgolden LoanSafe Member

    Thanks Pollyanna,

    I appreciate the response - oh well, I should have expected it... I decided on this course of action and I need to live with the consequences. I knew I'd take a hit with my credit and I knew I'd be taking a gamble as to whether the banks would come after me in the foreclosure/deficiency but I had no idea that it would take this long!

    You seem very knowledgeable on the laws/guidelines in MD. Would you mind giving me your opinion on WHY it has gone this long without a foreclosure? All I keep receiving are NoDs from the 2nd. I think I received an "intent to foreclose" from the first but that's the last I've heard from them and that was probably a year ago. About a year into it (I haven't paid since July of 2010) I received a letter from a law firm (I forget the name) that was one of the ones that was targeted in the case that went to the MD Supreme Court for robosigning. Could that be the issue?

    I just don't understand why there seems to have been no progress. What would you advise for my situation? I'd like to just settle with them and get this over with but I feel like I'm flying under the radar enough right now that if I contact them for anything it'll remind them to go after me. Is this making any sense?

    If you do this for a living I'd certainly be open to paying you for your advice - I don't know how best to contact you if you're willing but I'm pretty stressed right now (understatement) and it'd be great to talk with someone who knows what they're talking about.

    Either way, thanks for your input.

  4. pollyanna

    pollyanna LoanSafe Member

    BTW, have you been receiving anything from the first lender since you moved? A monthly bill?
    Last edited: Nov 11, 2012
  5. alexgolden

    alexgolden LoanSafe Member

    Not a thing from the first mortgage - can't even log into the account online anymore. Do you think that might mean something?

    Thanks for your advice (again). In reference to saving - yes, I have a good amount saved which is why I'm so stressed about them coming after me. I'm renting right now just saving as much as I can to buy a house with cash once I hit the sweet spot. Could afford something nice right now but waiting to save enough for something closer to our dream house. Kills me that for what I paid for our 2nd house in MD I could have a gated mansion with dolphins jumping over the driveway paved with gold (not quite, but the cost of living is ridiculously low here compared to MD/DC).

    Hopefully as this plays out I'll get a chance to settle with the 1st & 2nd vs. paying 100% of the deficiency OR they'll 'forgive' the debt and I'll just have to pay taxes on it. That's the best case - worst case is Chapter 13 which was always the backup plan all along. I just didn't fathom that I'd be able to save as much as I have over the last 2 years and it is pretty stressful realizing I could lose almost all of it in a judgement. But hey, like I said, I made a decision and need to live with it!

    Thanks again,

  6. angelescrest

    angelescrest LoanSafe Member

    Alex, what's been the result of this after a year? You had cash on hand, are they coming after your savings? Have you received legal counsel?

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