question about deficiency bids
I've come across the term "deficiency bid" and I'm wondering how often would a bank really let this happen as opposed to just buying the property and try to sell it as REO down the road? I guess it depends on how much less the successful bid is from what the homeowner owes the bank? I understand that banks in theory don't want to be managing properties as REOs - but how successful are they going to be to get the missing money from the homeowner? I'm surprised though in the case where a homeowner looks like they owe the bank more money that fair market value on the house, that the homeowner wouldn't try to go the bankruptcy route.
Anybody care to share with me what their experience has been with deficiency bids? Thank you!