The bank doesn't have a right to come after you for the deficiency unless it was an investment property. 

The inspector should check all the major systems of the home and search for deficiencies and deferred maintenance. 

Hardship, safety deficiency, mold concern, maintenance can get delayed.

The guarantee simply means if you default and the bank forecloses, once they sell their collateral if there is a deficiency or deficit, then SBA will pay 75%-90% of the deficit.

Do you know if corporate will cover any of the deficiency?

Three ways to get rid of a second.Pay it offNegoiate it down and get it releasedForecloseWhat you get, as far a s a release, will depend on what kind of second lien it is.. a cash loan can obtain a deficiency.

Even worse if they have some tax liability or a deficiency or are asked for a prom note or cash contribution as a result.

or should she just let it go and deal w/ probable/possible deficiency later(She does have job earning approx 50k/yr).

If they agree to accept the short, and don't give you a deficiency judgment, they will send you a 1099 for the forgiven amount.

The good thing about the program is there is the lender (primary lender) will not pursue the deficiency, however, the secondary lender can.