Friday, August 26, 2011

Illinois Foreclosure Home Sales and Discounts Increase

The Chicago Sun-Times reported yesterday on new data from RealtyTrac which found that price discounts for Chicagoland homes sold while in some stage of foreclosure reached near all time lows.  These homes in foreclosure made up 37.6% of sales in the Chicago metropolitan area, which includes Oak Park, River Forest, and surrounding communities.  The average discount price for these sales was nearly 50%.  Our Oak Park foreclosure lawyers understand that local community members may be interested in these sales figures as they consider their options while in foreclosure.

The raw figures indicate that over 8,600 homes in foreclosure were sold in our area in the last quarter.  That is up from last quarter but down nearly 8% from this time last year.  The average sale price of a home in foreclosure was slightly over $135,000, which is 50% less than the average sale price of homes not in foreclosure.  Chicagoland had more foreclosure sales and steeper discounts when compared to the rest of the state.  Similarly, nationwide only 31% of sales were of foreclosed homes, and the average discount in those cases was only 32.1%.  This means that foreclosure sales seem to be more prevalent in our area than in other parts of the country.

These figures indicate that there are bargains available for new homebuyers and potential challenges for those looking to sell while not in foreclosure.  For residents in our area facing an Oak Park foreclosure, this data suggests that lenders may be becoming more willing to approve a short sale. 

When working with clients in our Chicagoland foreclosure defense practice, we often learn about families whose homes are underwater with mortgage obligations much higher than the current value of the home.  In these situations it is often difficult for distressed homeowners to recover, because the only way they can sell the home is if it is for less than what they owe.  When a sale takes place for less than the mortgage debt it is known as a short sale.  Real estate experts believe that the recent increase in pre-foreclosure sales, steeper discounts, and shorter average selling times mean that the housing market is starting to focus on more efficiently selling distressed homes.  This may result in a more streamlined short sale process. 

All of these changes have effects on the specific options available to area residents who are struggling with their mortgage obligations. Short sales usually require approval from lenders and many residents are often unsure whether these sales are their best option.  Our attorneys have years of experience working with families in these exact situations.  We have come to understand that many distressed homeowners have more options available to them than they aware.  However, the state law in this area is frequently changing, and delay in seeking professional legal help could mean the difference between having a strong foreclosure defense under the law and waiving the right to make certain arguments.  If you are facing foreclosure in Oak Park, River Forest, or throughout the Chicago area, please get in touch with an Illinois foreclosure defense lawyer to learn about what legal options are available to you.

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Tuesday, August 23, 2011

Bankruptcy Filing Numbers Drop, But Financial Struggles Continue

In tough economic times it is not uncommon for more and more individuals and families to find difficulty meeting expenses.  Whether it is the loss of a job or growing payments on credit card or mortgage debt, the real possibility of not being able to meet financial obligations is disheartening.  Most people have not contemplated what their course of action would be if they could no longer make the minimum payments on their debts.  Unfortunately, as that very situation becomes more common some believe that filing for bankruptcy comes with an unjustifiable stigma by those it could help most.   

A recent story in the Chicago Tribune reported that U.S. consumer bankruptcy filings fell 18 percent between July 2010 and July 2011. While these figures from the National Bankruptcy Research Center may sound like the positive signs of a rebounding economy, our Oak Park bankruptcy lawyers know that there remains a strong demand for legal help in these matters.  Somewhat discouragingly the Labor Department recently announced that unemployment rates remain near 9.2%.  When the unemployment figure takes into account individuals who are merely working part-time jobs for economic reasons, it rises to 16.2 percent, making it likely that Illinois bankruptcy filings will not be sharply declining anytime soon.

In what is perhaps a reflection of a nation tightening its belt, the Commerce Department cited a 0.2 percent decline in consumer spending in June.  Even if that trend were to continue it does not mean bankruptcy numbers will immediately relent.  American Bankruptcy Institute Executive Director Samuel Gerdano has stated that “there is typically a 12-18 month lag between declines in consumer spending and bankruptcy levels.”

With nearly a sixth of the country unemployed or underemployed and no let up in bankruptcy rates expected in the near future it is likely that more individuals will be considering this process as a way to obtain relief from overwhelming debts.  To the uninitiated bankruptcy may seem like a willful destruction of your finances, requiring the filer to liquidate all of their assets and possessions.  That is simply not the case.

While Illinois bankruptcy filings cannot eliminate debt from things like child support, alimony, certain types of student loans or recent back taxes, it does eliminate most other kinds of debt and can allow the filer a much desired opportunity to get their finances back on track.  Additionally, bankruptcy does not require the person filing to impoverish themselves and forfeit benefits they may have spent decades earning.  Payments from pensions, social security, retirement plans and workers’ compensation are often protected as may be exemptions towards a residence, cars and personal property.

Our Oak Park bankruptcy lawyers know that in some circumstances filing bankruptcy can help to clear up one’s finances before a situation is exacerbated further.  Even the most indebted person can regain a modicum of control over their financial future through the benefits of filing bankruptcy. Anyone facing serious financial hardship would be well advised to consult a bankruptcy professional to learn if filing might be in their best interest.

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Friday, August 19, 2011

Changes to Illinois Mortgage Foreclosure Act Curtails Important Foreclosure Defense Strategy

The Illinois General Assembly recently passed an amendment to the Mortgage Foreclosure Act that will severely impair homeowners in their Illinois foreclosure defense cases.  The amendment sets a deadline for filing a motion to dismiss based on an objection to the court’s jurisdiction over the defendant in a foreclosure action at 60 days after a homeowner merely appears in court or files an appearance in court. 

A homeowner may appear in court for a number of reasons, even for something as minor as notifying a judge that he or she is applying for a loan modification.  Loan modifications are commonly sought by those seeking more flexible payments choices to meeting their financial obligations.  These modifications can often help homeowners meet their payments, avoid foreclosure, and keep their homes.  However, the recent amendment will put homeowners at risk because it significantly curtails the deadline by which a homeowner can file for a motion to dismiss a lender’s case after essentially appearing before a judge for any reason. 

Our Oak Park foreclosure attorneys know that the motion to dismiss is a powerful defensive tool in litigation.  If granted by the judge, it ends that particular case completely and often forces the plaintiff-bank to reevaluate the legal framework under which they filed the act. The recent changes to the Mortgage Foreclosure Act are extremely troubling because homeowners who are not represented by an attorney may not be aware of all of their rights.  Homeowners who attempt to work with the bank early on in the process in order to avoid losing their homes may never file a motion to dismiss and may not realize they are giving up an important right by merely going before a judge and explaining their situation.  If the case later progresses and the homeowner is not able to work with the bank, the homeowner who has already appeared in court may have lost his or her right to file a motion to dismiss based on personal jurisdiction forever.  For example, this will frequently be the case in situations where the homeowner tried to obtain a loan modification and could not get one or the bank was not honest with the homeowner about the chances of modification.

Especially in these tough economic times when many families are struggling to make ends meet, foreclosure can occur for many reasons.  Homeowners should not consider a situation hopeless, because there are many foreclosure defense options at their disposal, including seeking out professionals who are experienced and well versed in Chicago foreclosure law.  Changes to Illinois foreclosure law make it imperative that all residents take steps right away to ensure that they have as much up-to-date information about foreclosure defense as possible so they can best protect their rights.

Protecting the rights of homeowners is the main goal of our Oak Park foreclosure lawyers. Properly defending a foreclosure action is essential because failing to do so can risk homeowners the loss of their home, a personal judgment for the debt, and the loss of future credit, since a foreclosure judgment appears on credit reports. If you or someone you know is going through this process, please contact our attorneys at Emerson Law Firm to learn about your rights and take advantage of your legal options.

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Friday, August 12, 2011

Alleged Bank Fraud and Fabrication May Have Ramifications on Chicago-Area Foreclosures

An Oak Park foreclosure lawyer needs to consider all possible defenses when acting as a zealous advocate for their clients.  Often this requires keeping breast of legal developments across the country that affect bank mortgage and foreclosure practices.  Foreclosure attorneys know that even actions in other parts of the country may have ramifications for local homeowners. 

For example, this weekend the Huffington Post reported on strong statements made by the New York Attorney General that alleges that the Bank of New York Mellon engaged in fraud in the mortgage bond process.   The state legal chief is asking a judge to reject a proposed settlement between that bank and Bank of America because of what he alleges to be knowing, repeated, and consistent misleading of investors about the mortgage bond creation process. 

Bank of America had reached a settlement with many investors after questions arose about the institution’s improper securitization of mortgages.  BNY Mellon was acting as a trustee for those investors.  However, the state attorney general is claiming that BNY Mellon violated its fiduciary duty as a trustee by committing fraud and misrepresenting information about the mortgages to investors.  Therefore, the state official is requesting that the judge reject a proposed $8.5 billion settlement between Bank of America and BNY Mellon.  The settlement would represent only 4 cents on the dollar of the current $220 billion owed to those investors.

The proposed settlement was connected to a larger inquiry involving whether the law was followed when these large banks bundled mortgages and re-sold them to investors as mortgage-backed securities. 

Many local residents may have read about these documentation problems.  To protect homeowners and ensure fairness in the mortgage process, the law requires banks and others involved in the process to properly assemble and maintain important loan documents.  Those documents are required to turn a mortgage on a property into a security that allows the purchaser to foreclosure upon the home if the owner defaults.  When those documents are absent, the bank may not have the legal right to foreclose.  For some area residents the missing documentation is an important component of their Chicago foreclosure defense. 

Investigators have repeatedly found that many banks engaged in sloppy practices during the housing bubble.  In a rush to complete as many sales as possible and quickly bundle mortgages, companies often failed to properly follow the law when turning the mortgages into securities.  As one bankruptcy professor explained to a Congressional committee last November, “If mortgages were not properly transferred in the securitization process, then mortgage-backed securities would in fact not be backed by any mortgages whatsoever.” 
Distressingly, some unethical institutions may have attempted to get around the documentation problem by illegal means.  Besides challenging the settlement offer, the New York attorney general has also accused Bank of America of fabricating missing documents when foreclosing on homeowners who defaulted on their mortgages.

Our Oak Park foreclosure attorney knows that banks are not above the law.  Unfortunately, negligent banking practices, missing paperwork, and forged documents are all-too-common tactics used by lenders seeking to unfairly foreclose on area homes.  That is why it is vital for all residents in this situation to seek out professional help to understand how new information about problematic bank practices may affect their own case.     

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Friday, August 5, 2011

Slight Increase of Chicagoland Foreclosures in June

Distressing economic news seems to pour in every morning as families across the country continue to experience financial struggles.  Our Oak Park foreclosure attorneys know that every day is a battle for many area residents who are trying to stay afloat by spreading dwindling resources across a growing number of obligations.  Unfortunately, the total number of local community members dealing with these issues may be growing. 

The Chicago Sun-Times reported late last month on the disappointing new figures released by RealtyTrac which indicate a slight uptick in the number of Chicago foreclosures in June as compared with May.  June filings were 2.3% higher than in the previous month, rising to a total of 9,870 homes.  These local figures are similar to those seen nationwide.  Filings increased 3.6% across the country from May to June.  However, it is important that these figures be kept in check with comparisons to the same time last year.  There were nearly 13,500 foreclosures in our area in June of 2010—meaning that foreclosures actually dropped nearly 27% from last year’s high. Many foreclosure actions this year have been stalled because of documentation problems that affected upwards of 1 million cases nationwide.

Based on the June figures, 1 out of every 383 homes in our area is in foreclosure.  The total number of bank owned properties in our area jumped 19.3% from May, but the figure is still significantly lower than it was at this time last year.  While these area statistics are not encouraging, some other parts of the country are facing much starker home ownership issues.  For example, in Nevada nearly 1 out of every 114 homes is currently in foreclosure—more than 350% more than in Illinois.

Foreclosure filing statistics are useful barometers for the health of the area housing market and the overall economy.  However, our Oak Park foreclosure lawyers understand each individual family dealing with a foreclosure is less concerned with these figures and more concerned about how they should deal with their own financial situation.  As notices pile up, many area residents often develop a sense of hopelessness about their home ownership situation. 

Fortunately, in many cases the situation is not nearly as hopeless as most suspect.  While challenging a bank often seems like an impossible task, many community members may have valid defenses of which they are unaware to help fight their foreclosure.  No defensive strategy is the same, because no home ownership situation is identical to another.  Some residents are seeking a loan modification, whiles others may be trying to execute a deed in lieu of foreclosure.  A few residents may have had problems with the HAMP Process (Home Affordable Modification Program).  Whatever the case, there is usually little to lose by taking advantage of the various options that exist to help owners in these situations.

We encourage all area residents in these and similar situations to consider their Oak Park foreclosure defense options.  It is only by seeking out professional assistance that community members can gain a full understanding of their rights in these situations and make appropriate decisions about what is best in their particular case.

Tuesday, August 2, 2011

Helping Chicagoland Residents Fight Foreclosure

We are happy to announce the start of the Oak Park Foreclosure Lawyer Blog.  This new online resource is intended to help residents of the Chicagoland area better understand their legal rights related to mortgage foreclosure, real estate transactions, bankruptcy, and similar issues.

Our Oak Park foreclosure lawyers have been providing legal services to area residents since 2000.  We are proud of our efforts representing the interests of community members as they work to keep their home, purchase a new home, and deal with financial setbacks.

Be sure to check this space often to learn more about foreclosure and real estate legal issues in our area.