In the recent era of difficulty in some sectors of the commercial real estate market, lending institutions and borrowers are faced with difficult litigation decisions with respect to foreclosure and deficiency actions. With defaulting commercial real estate loans secured by property which cannot be sold or can be sold only at substantial discounts, lenders are more often today determining that they would rather pursue actions against obligors and guarantors first, without aggressively pursuing foreclosure. Lenders also have varied internal accounting rationales for not wanting to foreclose on a commercial property. These litigation decisions are made more complicated by the unsettled case law in New Jersey with respect to the application of a nonstatutory fair market value credit in a deficiency action on a note or guaranty where there is a related mortgage on commercial property. When a financial institution is considering a deficiency
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