What To Do If Your Property Is Going Into Foreclosure

If your home is going into foreclosure in Illinois, it is understandable if you are stressed and unsure about the future. However, be aware that if you are behind on your mortgage payments in Illinois, the loan servicer will eventually start the foreclosure process by filing a lawsuit in court. However, it can take 12 to 15 months in Illinois to complete a foreclosure, so you may have time to work things out.

In this article, you will learn what to do if your property is going into foreclosure. If you need help, you can count on our foreclosure attorneys in Illinois at Covert Marrero Covert LLP to help.

Notice Of Breach

The lender is required to send you a breach letter at least 30 days before the foreclosure is filed. It must contain the total due to cure the default. If you cannot pay the accelerated debt, the foreclosure process begins.

When Can Foreclosure Start?

US law requires the loan servicer to wait 120 days after the last payment to start foreclosure proceedings. However, the process can start sooner if you have violated a due-on-sale clause or the loan servicer is part of a foreclosure action with another lienholder.

How To Reinstate The Mortgage Before Foreclosure Sale

Even if the foreclosure process has started, there are ways you can fix the situation. Reinstating means bringing the mortgage current when you pay the delinquent payments, including principal, interest, and late fees. Once you complete the reinstatement process, the foreclosure stops.

Illinois law states you can reinstate the loan within 90 days after you get a summons regarding the foreclosure. However, many mortgage companies will let you reinstate the loan if you do so at least a few days before the foreclosure sale. It is usually in the loan servicer’s interest to avoid foreclosures if possible.

Be Aware Of Deficiency Judgments After Foreclosure In Illinois

If your home is sold in a foreclosure sale, it may not produce enough money to pay off the full loan. The difference between what the home is sold for and the total debt is known as a deficiency balance. Illinois law allows the mortgage lender to obtain a personal judgment – a deficiency judgment – for the amount owed.

Foreclosure Sale And Eviction

In the State of Illinois, before the foreclosed home is sold, a sale notice has to be put in the newspaper for three weeks. You also must be notified by mail at least 10 days before the foreclosure sale.

Call Our Foreclosure Attorneys In Illinois Today

Illinois foreclosure laws are complex, and lenders and servicers may make errors or skip steps. If you believe your lender or mortgage loan servicer did not follow the foreclosure process correctly, you could have a case that makes the company restart the foreclosure process.

Contact our foreclosure attorneys in Illinois at Covert Marrero Covert LLP at (630) 717-2783 if you are facing foreclosure. We may be able to help to save your home and provide other legal options available to Illinois residents.

Steps to Take When Buying a Foreclosure

A foreclosure purchase is a bit more complex than the purchase of a listed property, but a great deal can make the hard work worth it. If your home is going into foreclosure, on the other hand, hire a foreclosure defense lawyer to fight for your rights.

How to Purchase a Foreclosed Property in 5 Easy Steps

Buying a foreclosed property involves these basic steps:

Step 1 – Find Representation

Before you look for foreclosed properties for sale, find an agent with experience. The purchase has several risks you may not be aware of before it is too late. A veteran real estate agent can pinpoint red flags, tell you if the neighborhood’s property values are declining, and locate top-quality bargains.

Step 2 – Get Pre-Approval

The foreclosure market is highly competitive – most investors pay cash upfront, so these properties sell fast. If you cannot pay for one immediately, get financing beforehand. To do that, get pre-approved for a loan. Find out the amount you can borrow beforehand to make an offer.

Step 3 – Shop Around For Foreclosed Properties

Once you know the amount you can offer, shop around for foreclosed properties with your agent. Compare similar options to determine their pros and cons before choosing. This includes the value of homes in the neighborhood.

You can find a listing in local newspapers, REO listings in banks, or on large real estate sites such as Zillow. If you choose the bank option, you will have to wait a bit for a response. This includes a showing to see if the property is worth your investment. A skilled agent will make the process easier and expedite it.

Step 4 – Executing a Sale

Whether you find a foreclosed property at an auction or through referrals from your agent, you must make an offer. Make sure it fits your budget, i.e., the loan amount you were approved for and any additional financing you can arrange.

Your budget should leave room for repairs, renovations, property taxes, closing charges, inspections, and insurance. If you go over budget, you may have to sacrifice some of these aspects, reducing the property value further.

Step 5 – Inspections and Liens

You can arrange an inspection as soon as you finalize an offer. But inspect the property yourself beforehand. Inspections can range anywhere from $400 to $800, depending on the options you pick. For example, you will have to pay more for an in-depth home inspection, including a radon and termite check and sewer and waterline assessment.

It would help if you also resolved liens beforehand. Most foreclosed properties have multiple outstanding loans that belong to different lenders. Hire a title company to sort through these and reveal/resolve conflicts before you get a loan for the purchase. Move towards closing when everything is resolved.

Contact Covert Marrero Covert for a Consultation Today!

If your home is undergoing foreclosure, you can appeal the decision with help from a foreclosure defense lawyer in Illinois from Covert Marrero Covert, LLP. We provide personalized legal services that can ease your stress, frustration, and fear. Don’t go against aggressive adversaries on your own. Contact us for a consultation today by dialing 630-717-2783.

Will Short Sales And Foreclosures Increase In 2023?

Foreclosures and short sales may increase significantly in 2023 in Illinois and the US. Home sales are low, and prices skyrocket as inflation takes over the nation. However, there has been an increase in home sales in the state compared to 2021. So while foreclosures and short sales are at an all-time high, these sales may tip the balance in an investor’s favor.

Housing Costs on the Rise in Illinois

Today, potential homeowners in Illinois must pay about $8,000 to secure a property. This includes $5,000 yearly for the mortgage. Skyrocketing inflation, increasing mortgage rates, and high property taxes have much to do with this and have also increased the cost of living. It is little wonder why foreclosures have more than tripled in Illinois compared to last year. Most people cannot keep up.

Amendment 1 will potentially make this dire housing and living situation worse. If it passes, it will make housing unaffordable for most people in the state. On average, they can expect to pay an additional $2,000 in property taxes in the next couple of years.

During this time, yearly property taxes have increased by more than $1,000, equal to five additional mortgage payments for Illinois residents. In total, housing costs may increase by almost $5,000 yearly for the same home you would get in 2022. This does not include maintenance and homeowner’s association charges.

Foreclosure Rates in Illinois

According to Market Watch, in metro areas, foreclosure filings increased by more than 95%, and Illinois was not the only state to go through this. New Jersey and Chicago also experienced skyrocketing filings, but California, Tennessee, Ohio, Florida, and Illinois topped the list. The rates went back to pre-pandemic levels in the first half of this year, but they may normalize by the first half of 2023.

Most foreclosure activities are based on loans delayed more than 120 days before the pandemic or already in foreclosure. Most of them were protected by the moratorium placed by the government. In other words, it was only a matter of time before foreclosure rates normalized again.

If your home or any other property is in foreclosure or at risk of a short sale, you have more options than you think. A DuPage County short sale attorney can detail them for you and provide the necessary paperwork.

Where will you and your family go if you lose your home? The pandemic has wreaked havoc on businesses leading to income loss on a massive scale. But you can still recover with help from experienced foreclosure attorneys.

Contact Covert Marrero Covert LLP for A Consultation Today!

If you have received a foreclosure notice or want to know more about short sales, contact our DuPage County short sale attorney at Covert Marrero Covert by dialing 630-717-2783. You must get legal help as soon as possible and before your debts increase. Our attorneys cover all the bases and ensure your interests are protected.

All of our consultations are strictly confidential, and the first is free of charge. If you wish, we can accommodate an off-site meeting or a meeting after hours if you are too busy during the day. Our attorneys speak various languages, so communication is not an issue. We can develop a custom strategy to help you avoid foreclosure or other positive results.

Are Foreclosures in Illinois on the Rise?

The Covid-19 pandemic has wreaked havoc on the real estate market. As people lost their jobs and companies shut down in the hundreds, many found their properties go into foreclosure as they failed to make timely payments.

The State Of Foreclosures in Illinois

According to a Foreclosure Market Report from ATTOM, foreclosures in Illinois were at an all-time high in 2021. It had the highest foreclosure rate in the country. According to the report, one in every 3,848 housing units had a foreclosure filing per month. Besides Illinois, other states that experienced foreclosures on a large scale included Delaware, Nevada, and New Jersey.

ATTOM discovered these national figures from foreclosure filings entered into its database. The data itself covered 3,000 countries across the nation and over 99 percent of its population. The company evaluated more than 200 metro areas and found that Rockford had the fourth, and Chicago had the third most foreclosures in the state.

The foreclosure process started in August when lenders couldn’t wait anymore. They foreclosed more than 8,000 properties across the country during that time. This was a 27 percent increase from the month before and an almost 50 percent increase from 2020.

A Light at the End of the Tunnel

Even though foreclosures were high in September, ATTOM Executive Vice President Rick Sharga believes they are far from historically normal figures. For example, foreclosure rates were almost 70 percent lower than pre-pandemic numbers, and the total number of foreclosure activities was just 10 percent less than that.

However, even though numbers seem to be normalizing, many borrowers are leaving forbearance programs. Only time will tell whether Illinois foreclosures will follow the same trajectory or slow down and return to normal levels.

The Five Phases of an Illinois Foreclosure

The foreclosure process can differ by state, but the common phases it follows are the same nationwide:

  1. A borrower defaults on a loan.
  2. The borrower receives a notice of default from the lender.
  3. The county office records a notice of trustee’s sale.
  4. The property is sold at a public auction. The lender becomes the property owner if it doesn’t sell.

Contact the Lawyers at Covert Marrero Covert LLP for Foreclosure Issues

If you received a notice for foreclosure on your property, know that it is not the end of the world. You may think you need to face the issue alone, but you don’t have to if you have sound legal representation. Get in touch with the dedicated Illinois foreclosure defense lawyers at Covert Marrero Covert LLP for legal representation. We can help you find the solutions you need.

The faster you act after receiving the notice, the better. We can help you develop a payment schedule, modify your mortgage agreement or even file for bankruptcy to stop the foreclosure. Just book a consultation with us at our Warrenville, Naperville, or Schaumburg offices.

Our attorneys are dedicated to aiding people who think they are cornered and have no way out of their dilemma. We have years of experience helping people like you who were in worse circumstances.

How Long Does a Foreclosure Stay on Your Credit Report?

A foreclosure on your assets can be the absolute worst thing that can happen to your credit report. However, if you default on your mortgage one too many times, you will have no choice in the matter. What is devastating is a foreclosure can remain on a credit report for seven (7) years from the date of the first missed payment. It can seriously bring down your credit score as well, which can compromise your ability to get a loan in the future. Typically, a default notice arrives in 60 or 90 days when you fall behind on your mortgage payments. An Illinois foreclosure attorney will tell you the process initiates when the complaint to foreclose is filed by the lender.

How a Foreclosure Affects Credit

A foreclosure can knock your score by as much as 400 points, but there isn’t a consensus on the exact amount that is deducted. Each crediting agency has its own scoring algorithm, which it keeps secret. Even if your agency has notified you of your score, it may not be the score the three main credit agencies maintain. In other words, even if your history is the same on all three, your score may not be the same.

That’s because each company has its own rules and regulation for every piece of information that is present on a credit report. One may focus on open collections while another may focus more on missed credit payments.

Whichever company or lender you go with, if you face foreclosure, bouncing back from it should be your priority. It is not the end of the world, but it can be a nightmarish experience nonetheless. The first thing you need to do is to see if your reports had any mistakes in them. If you spot several, you can file a dispute and have it corrected. By doing so, you can ensure a loan application doesn’t get rejected later and help you get your life back on track.

Hire an Illinois Foreclosure Attorney

Receiving a foreclosure notice can be one of the most devastating events anyone can go through. This is where our foreclosure attorneys can prove invaluable. At Covert Marrero Covert, LLP, we provide moral and legal support to clients who are facing this issue and help them find real solutions. Get a ‘foreclosure attorney near me’ in Naperville, Schaumburg, and Warrenville, IL today by getting in touch with us for a consultation.