• Surprising Ruling by Georgia Court of Appeals May Allow for Pursuit of Guarantors without First Confirming Foreclosure Sale in Certain Circumstances
  • January 31, 2014 | Author: Kelly E. Waits
  • Law Firm: Burr & Forman LLP - Atlanta Office
  • As any lender who’s had a loan secured by real property collateral in Georgia knows, in order to pursue a deficiency balance following a non-judicial foreclosure of its collateral, the foreclosure sale has to be “confirmed” by the Superior Court in the county where the property lies. The purpose of Georgia’s confirmation statute is to ensure that the property sold at foreclosure brought its true (fair) market value, as well as ensuring that the property was advertised properly and that the obligors received proper notice of the sale in accordance with statutory guidelines. Georgia’s confirmation statute was enacted during the Great Depression when many mortgagors were forced into bankruptcy by the deficiency judgments which were sought and obtained against them after their mortgage lenders had acquired the property at non-judicial foreclosure sales for nominal or depressed prices. The intent of the legislature in enacting the law was to protect borrowers from deficiency judgments when the forced sale of their property brought less than fair market value.