When you can't pay your mortgage on time, you start to panic. How much time do I have to get caught up? What happens when a foreclosure is filed? How soon can they sell my house, and what can I do to stop it? What follows below is a description of the process and answer to these questions.
You know a foreclosure is very serious. You should understand what the mortgage can do and what you can do to help yourself.
GENERAL TIME FRAME BEFORE THE FORECLOSURE BEGINS
Mortgage payments are generally due on the first of each month, but treated as on time as long as they are processed by the 15th. If the payment is processed after 15 days a late charge is assessed. Bear in mind that payments are usually processed a few days after they are received.
Once the account goes into the second month of being unpaid, the mortgage account becomes delinquent. Somewhere between 45 and 60 days the mortgage company usually sends a letter demanding full payment
If the home mortgage remains delinquent between 90 and 105 days the mortgage company stops accepting any payments and declares a default. The loan then gets transferred to the loss mitigation department (foreclosure department) and referred out to a foreclosure law firm.
The law firm may send a letter to the homeowner about the delinquency to allow them time to pay the back payments and additional fees and costs. In addition, the mortgage company or its attorney must serve a notice of the right to reinstate the loan at least 30 days before filing a foreclosure.
If attempting to catch up at this point, the homeowner must come up with the full amount owed in one payment i.e. payment plans will not be set up. The law firm will conduct a title search to determine what parties will be a defendant in a foreclosure law suit: like 2nd mortgages and other possible lien holders. The cost of the title search, as well as all attorneys' fees and other costs, is added to the amount that must be caught up.
Illinois is a judicial foreclosure state. That means a lawsuit has to be filed and served upon the homeowner, upon anyone with a recorded lien on the property, and also on other possible tenants in the property.
Once the foreclosure is filed Homeowners generally receive several letters from lawyers and others offering various services.
The homeowner has 30 days to respond after being served with the foreclosure.
The homeowner can, of course, file an answer denying various allegations and/or raise affirmative defense, if any. Also, the homeowner can file various forms of Discovery and/or Admissions. The Answer and Discovery are best done by an experienced lawyer. When answers, affirmative defenses, and discovery is filed the foreclosure process can be dramatically slowed and frequently takes years to come to a conclusion.
If the homeowner does not file any answer or otherwise plead the mortgage company can proceed to a default judgment. If the homeowner filed an answer but did not raise any issues, the mortgage company can proceed to a summary judgment. Either way, the result is often a judgment of foreclosure.
However, before a judgment can be entered the mortgagee must show that they offered a meaningful assistance to the homeowner. This is generally accomplished by appending to the law suit help resources available. (In other words they avoid their responsibility)
The judgment will include multiple charges totaling at least $3,500. Since January 1, 2014, the judgment can also include a deficiency clause meaning the homeowner would still owe money after the house is sold if the auction price does not cover the full amount owed.
JUDICIAL OR SHERIFF'S SALE
The next step is to schedule a judicial sale with at least 30 days' notice. Homeowners generally receive several letters from lawyers and others offering various services, but time is running out.
After the judicial sale the mortgage company must file a motion to confirm the sale. Most frequently this is presented within a few days after the sale. Once that is done the mortgage company or other successful bidder now owns the house.
The new owner will then ask the prior homeowner to vacate the premises. Sometimes they will offer cash for the keys.
If the prior homeowner does not move out a Forcible Detainer will be filed which gives a certain amount of days to move or be evicted by the sheriff.
SOLUTIONS AND OPTIONS
You, the homeowner, have various rights. You should become aware of them and use them.
Generally, folks cannot come up with a lump sum payment to fully catch up the mortgage or offer a repayment plan acceptable to the mortgagee.
Probably the most effective way of saving one's home is through a Chapter 13 Bankruptcy which allows a reasonable method of repaying the mortgage arrearage. The time period can be as long as 60 months, and the plan often reduces the payment to other debts.
A Chapter 13 can be filed any time after a delinquency up to the day before the judicial sale: The sooner the better when practical.
Also, if a Chapter 13 is not practical a homeowner can defend the foreclosure by filing an Answer to the complaint along with various forms of Discovery to be sure that the amounts demanded are accurate.
Also you might wish to review: MONEY JUDGMENTS FOLLOWING FORECLOSURE: http://www.robertadamslaw.com/money-judgments-following-foreclosure-illinois/
Our law firm has helped thousands of homeowners save their homes.
When facing foreclosure please feel free to contact our office. We will be happy to go over your options including foreclosure defense, Chapter 7, or Chapter 13. Our advice is free and confidential.
Robert J Adams & Associates has helped thousands of good people, just like you, save their home. Take advantage of our free and confidential consultation today.