A recent Chicago Tribune article discusses the condition of Chicago mortgage foreclosure, noting that the state is the third worst in the nation in foreclosures despite overall improvement across the country. Illinois and New Jersey still trail Florida, but both states are getting worse. In fact, according to the chief economist of the Mortgage Bankers Association, the Illinois foreclosure rate is more than double that of California.
One of the reasons Chicago’s foreclosure rate is so poor is not because loans necessarily are entering foreclosure at a greater pace than in other states, but because they stay in foreclosure for longer periods of time. For example, according to the Chicago Tribune, the percentage of loans in foreclosure in judicial states is at an all-time high of nearly 7% during the first quarter. In contrast, in non-judicial states the rate is 2.8%, the lowest since early 2009.
Illinois is a judicial foreclosure state, which means a lender must sue a homeowner in state court. Those of us working in Illinois mortgage foreclosure know that while judicial foreclosure can take longer, it typically yields more protections for debtors. In non-judicial foreclosure states, a homeowner receives a notice of default from the mortgagee. Thus, the mortgagee does not need to file an actual lawsuit to begin the foreclosure process. Oak Park foreclosure defense lawyers know this can be very problematic because some debtors may never receive a notice of foreclosure due to errors in the system, putting them in jeopardy of losing their homes outside of the protections of a court. In judicial foreclosure states, for instance, homeowners have the constitutional protection of due process, which requires the state to protect all legal rights of an individual and to ensure the legal procedures are fair.
Even though Illinois is a judicial foreclosure state, thus affording its citizens more protections than those living in non-judicial foreclosure states, creditors may try to play hardball or take advantage of debtors who are unrepresented by legal counsel. If you are concerned you may be facing Oak Park mortgage foreclosure, consider consulting with a legal professional. Homeowners should not give up. There are many foreclosure defense options at your disposal. Sometimes allowing your home to be foreclosed upon is the best option, but it is important to make an informed and careful decision because a house is likely one of the largest financial investments you will ever make.
More than a year ago, the Illinois Supreme Court formed a committee to study our state’s mortgage foreclosure process, as well as how other states are dealing with large volumes of foreclosure cases. The backlog of foreclosures, some of which is due to the exposure of lenders’ fraudulent behavior including robo-signing, is clogging the system. Some of the committee’s recommendations to ease the backlog include paperwork changes and providing homeowners with more notice about their rights. However, the committee also suggested that foreclosure sales should be held within 45 days of the expiration of the redemption period, the date by which a homeowner can make the mortgage current and keep the property, in most cases. Although this is only a recommendation, such a change could seriously harm homeowners’ rights, so it is important to speak with a professional if you are worried about losing your home since Illinois foreclosure law is constantly changing.
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