Banks that take a loss on the short sale of a house cannot force the borrower to make up the difference — even if the borrower agreed to do so as a condition of the sale — the Fourth District Court of Appeal ruled Tuesday.
Facing what it called "an all too familiar and unfortunate fact pattern in the wake of the collapse of the residential real estate market in 2008," the court held in Coker v. JP Morgan Chase that lenders can't go after homeowners to make up a shortfall regardless of whether a home is sold through foreclosure or short sale.
