If going through foreclosure weren't hard enough, there is also the fear of being sued afterwards by the lender. If the homeowner is not able to stop foreclosure, then the lender may be able to pursue a deficiency judgment. Theoretically if your home is sold at auction for less than the balance, then the lender can come back and sue the foreclosed homeowner for the difference in order to recoup costs.

It's important to understand that the foreclosure process is actually a very expensive process for the lender. Interest, legal fees and other charges can sometimes cause a lender to spend upwards of $30,000 to foreclose on a homeowner. So if the homeowner tries in vein to stop foreclosure and the home still goes to auction, it becomes very difficult for the lender to make that money back. Due to that, some states allow the lender to pursue the homeowner after the process has taken place and sue them for the difference of what the home actually sold for at auction. But in reality, this doesn't usually happen. The reason being is that the lender knows the homeowner doesn't have the money. After all, that's why they lost the home in the first place. So going after a homeowner with a deficiency judgment makes almost no sense. The lender will have to spend even more money in legal fees just to come after the homeowner.

That being said, it could still happen. Due to all the rampant foreclosures, lenders may be willing to pursue law suits in an attempt to limit their losses. This of course is the last thing a homeowner needs considering everything they already went through. More than ever, it becomes abundantly clear that the best solution is to stop foreclosure from happening. If you get behind on your payments, seek a solution. Contact your lender and ask them for help. If they refuse to help you or to give you a solution that you can afford, seek out a reputable company to assist you. There are many options that homeowners have at their disposal, but knowledge and experience will be your key to success. If you want to stop foreclosure and any possible law suits from your lender, make sure you do everything in your power to resolve the situation. If you can't stop the foreclosure, then consider selling your property or possibly even a deed in lieu of foreclosure. Of course you should seek advice from a tax advisor before doing that since there may be tax consequences if you give back your home. Keep in mind that getting sued from your lender is an unlikely scenario. Now your credit, well that's a different story. You're going to take a hit from that, however with the right motivation and education; you will be able to start a new life. Remember that you can survive this situation. You are strong enough to accomplish anything if you put your mind and heart into it.