Chicago Bankruptcy Lawyer Discloses New Tactics for Homeowners

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Chicago bankruptcy lawyer and financial rescue expert Richard Fonfrias of the Fonfrias Law Group, LLC (, has added an instructive new article to his website about foreclosure and deficiency judgments, providing important information and new tactics for homeowners in financial distress.

I believe it is important for people to know the facts and understand the possible ramifications of foreclosure or short selling, and to look at alternative courses of action.

To educate and inform the public on a wide range of legal topics, including bankruptcy, foreclosure, and debt management strategies, Chicago bankruptcy lawyer and financial rescue expert Richard G. Fonfrias, J.D., managing partner of the Fonfrias Law Group, LLC, regularly adds new educational articles to his website ( The latest article, titled - Foreclosure: You’re Not Necessarily Off the Hook: Deficiency Judgments Cause Big Problems, explains the term “deficiency judgment” and cautions cash-strapped homeowners that, even after foreclosure, lenders can come after them for outstanding balances.

“As if losing your home to foreclosure or being forced to “short sell” your home wasn’t bad enough, homeowners in financial distress need to be aware that they can be chased by mortgage lenders for payments even when they no longer own their home. I believe it is important for people to know the facts and understand the possible ramifications of foreclosure or short selling, and to look at alternative courses of action,” explains Rich Fonfrias.

When a lender foreclosures on a home it is with the intention of recovering all the money owed to them by the homeowner. If the house sells for less money than the value of the outstanding mortgage, the lender has other options they can pursue to get the remaining foreclosure balance or deficiency. Through a legal maneuver, the bank turns the deficiency into a deficiency judgment and chases the former homeowner for payment. This also occurs when the homeowner sells their home for less than the value of the mortgage (short sells). The unpaid balance of the mortgage is a deficiency judgment against the old homeowner which he is obligated to pay.

“In today’s economy, banks are finding it worthwhile to chase homeowners for deficiency judgments. They will come after a borrower for as little as $20,000. They can garnish wages and seize other assets to pay the deficiency. Banks perform credit checks for signs that a homeowner may be preparing to walk away from their home, such as being behind in mortgage payments but current on other bills. And, it’s not only the bank that homeowners have to watch out for. Banks often sell delinquent accounts to collection agencies, so a homeowner may find themselves aggressively pursued by unknown third parties demanding payment. As well, lenders and collections agencies can wait for years to enforce the delinquency judgment, biding their time until the homeowner has gotten back on his feet financially and has accumulated assets which they can seize,” reports Fonfrias.

In his article, Fonfrias also explains that a bank secures a mortgage in two ways; through the home as collateral and through the homeowner’s personal promise to pay. This means that even if a lender agrees to a short sale, the homeowner may not be release from their promise to pay and may be obligated to reimburse the bank for amounts outstanding.

“It is important to read all documentation closely to fully understand your responsibilities and obligations to the lender before signing any contract. There are often items hidden in the fine print that can come back to haunt you. Homeowners who are unable to keep up with their mortgage payments should consult with an experienced bankruptcy lawyer well before the bank starts foreclosure proceedings. There are alternatives. Often bankruptcy can be a preferred course of action, offering the best protection from creditors and a way to keep protect assets,” states Fonfrias.

Contact Information:
Richard G. Fonfrias, J.D.
Fonfrias Law Group, LLC
First National Plaza
70 West Madison, Suite 1400
Chicago IL 60602
Phone: 312-969-0730

About Fonfrias Law Group: Chicago Money Lawyer Richard Fonfrias of the Fonfrias Law Group has built a solid reputation helping clients in serious financial trouble find the right solution to their money problems. Serving Illinois, California and Florida, the Fonfrias Law Group’s dedicated financial rescue and bankruptcy team offer an extensive range of financial legal services, including bankruptcy defense, tax defense, debt consolidation, bad credit repair, foreclosure defense, credit card debt management, loan and mortgage refinancing advice. For more information or to arrange a free initial consultation with Richard, please call 312-969-0730 or visit

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