In addition to losing your home and the equity you may have foreclosure brings with it many other consequences.

Credit Score-A homeowner who loses a home to Foreclosure can expect to see their credit score lowered anywhere from 250 to over 300 points.  As a result, other creditors will consider them much less credit worthy, and raise their interest rates to very high levels.  For some, who have otherwise maintained good credit practices, it may only take a few years to see their scores improve and be able to negotiate better loan and card rates.  Others may never be able to recover.  Foreclosure will remain on a person's credit history for 10 years or more.

Buying Another Home-Purchasing your next home will be more challenging.  Fannie Mae Guidelines have recently extended the time frame required after a foreclosure from 4 years to 5 years. 

Other options may be available sooner to those who maintain a stellar credit history after foreclosure.  FHA, will allow a borrower to obtain a home loan after a minimum of 3 years, as long as they have re-established their credit.  Also Land Contract options are available to those with the ability to pay a down payment.

Deficiency Judgment-In cases where the home does not sell after foreclosure for the amount owed, the bank is entitled to pursue a deficiency judgment. The courts may order repayment of the unpaid balance when the foreclosure sale is insufficient.

Tax Liabilities-After foreclosure, if the lender agrees to a cancellation of debt, it may result in tax liabilities. As a general rule, anytime debt is forgiven it creates taxable income to the debtor in an amount equal to the difference between the amount due on the obligation and the amount collected on the debt.  The entire amount of the obligation is treated as gain. Exclusions to the obligation are granted through proof of insolvency, bankruptcy, and the Debt Relief Act of 2007.