After a lender has completed a non-judicial foreclosure sale of property, Georgia law at O.C.G.A. § 44-14-161 imposes a requirement that the lender “confirm” the sale if the lender intends to sue the debtor for any remaining debt (the “deficiency”). This law was enacted in 1935 to give protection to debtors.
For example, if the debtor owes the bank $100,000, and through foreclosure the bank sells the property for $60,000, then the bank may wish to sue the debtor for the unsatisfied debt (the deficiency) of $40,000. But, before the bank may sue, it must first institute a “confirmation” action to determine only two issues:
(1) whether the notice, advertisement and regularity of the sale were legal, and
(2) whether the sale brought the property’s true market value on the date of the sale.
Successful representation in confirmation proceedings requires that the attorney have a comprehensive understanding of the required notice and advertising procedures for non-judicial foreclosures, Additionally, because confirmation proceedings often require a judge to choose from competing appraisals, your attorney should have competency in understanding property appraisals and cross-examining an opposing expert appraiser.
Jim Fletcher has represented lenders and borrowers in dozens of Georgia confirmation proceedings. He constantly monitors the most current developments in the law, and is the author of a widely-read website which provides updates in this area of law to Georgia real estate law practitioners: http://www.ConfirmationLaw.com .
