Understanding Illinois Foreclosure Law

How to navigate Illinois Foreclosure Law
In today’s uncertain economy many families are unable or will soon be unable to make their mortgage payments. The clients that come to my law practice for counseling are mortified with thought of being thrown out of their house through foreclosure. To compound their fears homeowners who have missed a mortgage payment or a few payments are fearful that any day the sheriff with knock at their door and force them to leave their home.

Fortunately, in Illinois a homeowner who has missed a mortgage payment, or two payments, or even three payments will not immediately have to move out of their homes. In Illinois missing a mortgage payment in not the end of living in your home. It is only the beginning of the long process of foreclosure (in Illinois), A process where missing a mortgage payment will not result in immediate eviction from their home.

Certainly, missing a mortgage payment is reason for concern however, it is not the end of the world. Further, understanding Illinois foreclosure law can help homeowners have less anxiety and better make decisions about their future living accommodations.

Illinois Law: Mortgages in default can be reinstated
Good news, under Illinois law if a mortgage goes into default a homeowner can reinstate their mortgage. Reinstatement is effected by curing all the defaulted payments (paying the missed payments) and; paying all costs and expenses associated with the default (usually back interest, late payment penalties, and attorney’s fees). The reinstatement payments must e made within 90 days from the notice of default.

If the missed payments along with the interest, penalties, and attorney fees are paid in the 90 days prior to the notice of default the mortgage document shall remain in force as if no acceleration or default had occurred. See 735 ILCS 5/15-1602.

Illinois Law: Mortgages in foreclosure can be redeemed
More good news, under Illinois law if a home goes into foreclosure the homeowner can redeem their mortgage from foreclosure process. When the mortgage on residential real estate is foreclosed on the homeowner is granted a redemption period in which to stop the lawsuit for foreclosure and retain their home.

In Illinois the homeowner has 7 months to redeem their home from the date the homeowner is served with a summons for foreclosure or served by publication. See 735 ILCS 5/15-1603.
To redeem their home from foreclosure the homeowner must pay the following:

The amount specified in the in the judgment of foreclosure which shall consist of
a) all principal and accrued interest secured by the mortgage and due as of the date of judgment.
b) all costs allowed by law, this would include late payment penalties, additional interest from the date of judgment to the date of redemption, attorney and other administrative fees.

In my bankruptcy practice I often counsel with clients who have missed one or two mortgage payments. They are fearful the sheriff will be knocking on their door to evict them from their home.

Fortunately, Illinois foreclosure laws allow homeowners (through reinstatement or redemption) the ability to retain their home and gives the homeowner who has missed mortgage payments ample time to “save” their home.

What to expect you miss a mortgage payment (do not worry)
Generally, the mortgage lenders, large banks and corporations that do mortgage lending are bureaucracies and are generally unable able to foreclose if you have missed a only a single mortgage payment. This systemic inability to take action is frustrating, but is actually beneficial if you have not made a mortgage payment lately.

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Maryland Foreclosure Laws – Can the Latest Maryland State Foreclosure Laws Save Your Home?

Maryland foreclosure laws are quite different from other auction laws. Basically, these laws provide an understanding of the foreclosure process of the state and are different for every district or county. There are 3 main foreclosure laws of Maryland:

1. Judicial

2. Non Judicial

3. Right of redemption (depends on the case and decided by the court)

4. Time span – 3-4 months

1. Maryland judicial foreclosure law- In this process, if the payments are not made regularly by the borrower, the lender can get an order from the court to sale off the property. The lender can file a complaint ion the court only if the deed of trust contains no power of sale.

2. Maryland non judicial foreclosure law – In the non judicial foreclosure law of Maryland, the governor appoints a public trustee who acts commonly for all the auction sales. The authorized attorney of the lender, files the documents with the trustee office and recorder’s office of the area where the property is located.

· The clerk of the area issues a notice of demand from the borrower and this notice is published in the local newspaper for 3 weeks. Property sale will take place after 45 days, if the borrower does not respond and the lender is not supposed to send any information about the sale process to the borrower.

· According to Maryland foreclosure law, property sale can take place in any court and the sale would be handled by the trustee only

You can now save your home from getting sold through Maryland foreclosure laws:

· The court before issuing a decree for sale to the lender, will give you a chance to pay all the debt by giving you a time frame of some days. You must make all the payments pending up to date and save your property.

3. The right of redemption is a part of Maryland foreclosure law, which depends on the court. One can redeem the property after the sale. You will need to pay the entire amount on which the bid has been stopped and court will give you 30 days to arrange for the payment. If you succeed in making the payment in that time, you can get your property and the amount that has been paid by you would be used for foreclosing your loan.

Foreclosure Law

Even if you have suspected that your home would go into foreclosure, perhaps you were misinformed and believed you had to wait until you received a notice of default from your lender before you could do anything. Maybe even now that you have received the notice, you are still stunned and paralyzed with the fear of losing your home.

No matter what your situation may be at the moment, if you have just received a notice of default and are facing a foreclosure, now is an excellent time to get started on understanding the foreclosure laws that apply to your particular situation and to begin seeking help from professionals who can help to end foreclosure proceedings against your home and restore your home loan to a proper state of payment. Most importantly, you can achieve a peace of mind and return to sleeping at nights knowing that your home is not in jeopardy of being taken from you.

It cannot be overstated that foreclosure law is different from state to state. For example time frames for each state are as follows:

Alabama: 49-74, Alaska: 105, Arizona: 90+, Arkansas: 70, California: 117, Colorado: 145, Connecticut: 62, Delaware: 170-210, District of Columbia: 47, Florida: 135, Georgia: 37, Hawaii: 220, Idaho: 150, Illinois: 300, Indiana: 261, Iowa: 160, Kansas: 130, Kentucky: 147, Louisiana: 180, Maine: 240, Maryland: 46, Massachusetts: 75, Michigan: 60, Minnesota: 90-100, Mississippi: 90, Missouri: 60, Montana: 150, Nebraska: 142, Nevada: 116, New Hampshire: 59, new Jersey: 270, New Mexico: 180, New York: 445, North Carolina: 110, North Dakota: 150, Ohio: 217, Oklahoma: 186, Oregon: 150, Pennsylvania: 270, Rhode Island: 62, South Carolina: 150, South Dakota: 150, Tennessee: 40-45, Texas: 27, Utah: 142, Vermont: 95, Virginia: 45, Washington: 135, West Virginia: 60-90, Wisconsin: 290 and Wyoming: 60.

Just as each state has a different time frame, the laws that govern the particular state are different from the next state as well. There is no way to list all of the different laws that are applicable in their respective states. Even if it were possible to list all of the laws here, it would be impossible to keep the listing current as laws can change from state to state and year to year, depending on the state’s government and legislation.

Both judicial and non judicial forms of foreclosure regulations are used from state to state. Likewise, the sale publication and redemption period can vary, including some states where the court decides what the redemption period will be. There are many different web sites that offer some general information about foreclosure law for each state. These sites should not substitute for learning about the foreclosure law in the state applicable where the property is that you are concerned with.

Although foreclosure is a lender option to allow the lender to gain back the property or cash for the property, foreclosure law is designed to help the homeowner take advantage of the opportunities that exist with foreclosure time frames and various other laws within each state that work to help the homeowner stop foreclosure before losing their home.

Foreclosure Laws and What To Expect As A Borrower

Due to the current economic turmoil being experienced in the United States, there are many homeowners who now find themselves in the position of being behind on their mortgage payments. It goes without saying that this is an extremely stressful, and often scary scenario to find oneself in. Having an understanding of foreclosure laws can go a long way in helping to alleviate this stress, and empower oneself to take the appropriate actions to work with the bank and get things back on track.

Unfortunately, gaining such an understanding can be difficult, given that foreclosure laws vary from state to state. The process can be quite different from one state to another, and these differences will largely determine the proper course of action for a homeowner.

Foreclosure Laws in California

However, as an example, let’s examine the foreclosure laws in the state of California and how they impact the potential time line for foreclosure by the bank, and the eviction process if things progress to that level. Keep in mind that the timeframes stated here are merely what is possible. Your particular lender may not operate completely according to this schedule.

In California, after 90 days of non-payment on your mortgage, California foreclosure law allows the bank to record a Notice of Default.
After an additional 90 days, the bank is allowed to record a Notice of Trustee’s Sale.
21 days later, it is possible for the bank to sell your home at a foreclosure auction. This could result either in the bank finding a buyer for the home, or if the home does not sell at auction the bank could take the property back as an “REO”, or real estate-owned property. If your home sells at auction, at that point it could be nearly impossible to retain your home.
If the bank does take the property back as an REO, the bank’s asset manager may offer what is known as a “cash for keys” deal. Basically, the bank offers from $3,000 to $5,000 for you to voluntarily move out of the home within 3-4 weeks. After you have vacated the property, the agent for the bank can list the property on MLS for sale to the general public.

Once the process of selling your home is initiated by the bank, there are various methods available at your disposal to stop it, assuming that you are looking to buy enough time to work out a resumption of payments with the bank.

Bankruptcy

One option to stop the sale is filing bankruptcy. This creates an automatic stay on the foreclosure process. Unfortunately, this doesn’t always work as a long-term solution because a bankruptcy designed to allow you to keep your home often will require you to resume payments at the same amount you were at before going into default, plus more in order to pay off your arrears over three to five years. Obviously, unless your income has been restored to prior levels, this often is not a workable scenario.

Litigation

The only other way to force the bank to stop foreclosure is to sue the bank and get an injunction to halt the process. There are only a few possible grounds on which you can file such a suit, including statutory violations or mistakes during the foreclosure proceedings, and common law violations such as violation of the HAMP program, fraud, or breach of contract.

Colorado Foreclosure Laws – Can Latest Colorado State Foreclosure Laws Save Your Home?

Colorado Foreclosure laws main objective is to give a basic idea of foreclosure law for the region. These laws vary from state to state. Similarly, Colorado’s laws are designed to help the lenders whom mortgages are becoming delinquent day by day due to non payment and as well as for borrowers by providing them a platform to save their home.

Here are Colorado State Foreclosure Laws:

1. Colorado Judicial Foreclosure Law- If no power of sale clause is mentioned in the mortgage agreement, the lender can file a lawsuit in the court of judgment to get on official order to get your mortgage foreclosed. As and when the Colorado state court issues the order, your mortgage is set for auction and whatever the amount is fixed as the highest bid, the property is sold on that price and the bank uses the amount to foreclose your loan.

2. Colorado Non Judicial Foreclosure Law – Non judicial process is a bit different. A public trustee or a firm is appointed to act on the behalf of your lender, to handle a power of sale of foreclosure.

In this foreclosure law:

· This lender informs the attorney or the lawyer about the mortgage on which payments are delinquent. Now the attorney will file all the desired documents in the public trustee office of the same area where the mortgage property is situated.

· A notice of “election and demand” is filed with the area clerk and recorder’s office by the public trustee. After filing of the notice, the notice is published in the daily newspaper of the region of the property’s location for continuous 5 weeks.

· If the borrower gives no response, the property sale will start and it must be sold off in between 45-60 days after the notice of election and demand for sale has been filed. The trustee can approach any courthouse for the sale.

3. The whole process takes up to 145 days and this time can exceed too depending upon the case.

4. The fourth foreclosure law is right of redemption by which you can save your home

· You can redeem your property. You can file a letter of “intent to cure” with the trustee, 15 days before the sale of the property has to take place. You will have to make all the pending dues on the mortgage to make it current, and you can pay all the money by the afternoon of the day before the sale is to take place.

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