Friday, December 14, 2018

Foreclosure Evictions Postponed for the Holiday Season

Foreclosure activity continues in the Chicago area and throughout Illinois and the country, although foreclosure rates generally continue to decline. Indeed, a recent report from Business Wire indicated that serious delinquency rates were at their lowest in years, but 4.4% of mortgages remain at “some stage of delinquency.” In other words, more than 4% of mortgages are anywhere from 30 days past due to at the point of foreclosure eviction or foreclosure sale. The current foreclosure inventory rate is at about 0.5%. Despite the fact that foreclosure rates continue to decline or remain relatively low, it is important to remember that a number of homeowners are still facing foreclosure.

While Fannie Mae and Freddie Mac will continue to move through various stages of the foreclosure process during the holiday season, a recent article in HousingWire reported that both will be suspending foreclosure eviction lockouts between December 17, 2018 and January 2, 2019 for the holiday season.

Extending Timeline for Foreclosure Evictions in December

For Fannie Mae properties, any single-family homes, as well as two to four-unit properties, will have an extended timeline for foreclosure evictions. Starting December 17, no families will be evicted from those properties until after January 2 of the new year. Similarly, the foreclosure eviction timeline will also be extended for Freddie Mac properties, but the extension is a broader one. All foreclosed Freddie Mac properties that are currently occupied homes will not face evictions during the same time period.

According to the Fannie Mae vice president of single-family real estate, “We believe it is important to extend the timeline of help for struggling borrowers during the holidays.” Fannie Mae also encourages homeowners who are facing foreclosure to use this extra time to seek other options for foreclosure prevention. The Freddie Mac vice president of single-family servicer performance management echoed these sentiments, emphasizing how the mortgage servicer is “suspending evictions from Freddie Mac-owned homes to help provide families with a greater measure of certainty during the upcoming holiday season.”

Yet, to be clear, not all foreclosure activity is suspended. Only foreclosure evictions have been suspended. This means that other foreclosure activity, including both pre-foreclosure and post-foreclosure activity, will continue throughout December 2018 and into the new year.

Avoiding Foreclosure This Holiday Season
If you are facing foreclosure, there are numerous options that may be available to you this holiday season. An article from HGTV cites the following as common options for homeowners who are facing foreclosure:

  • Contact your lender to work out a compromise; 
  • Sell the home through a short sale, which often does not result in a profit for the homeowner but allows the homeowner to avoid damaging his or her credit any further and allows the homeowner to avoid foreclosure; 
  • Deed in lieu of foreclosure, through which the homeowner essentially signs the home back over the bank (but is not the best option for preserving a homeowner’s credit, and typically is only an option after a short sale and other possibilities no longer are available); and 
  • Chapter 13 bankruptcy, which can allow a homeowner to stay in his or her home while developing a repayment plan to pay off debt (once the homeowner files for Chapter 13 bankruptcy, the automatic stay prevents the foreclosure process from going any further). 

Contact an Oak Park Foreclosure Defense Attorney
If you need assistance avoiding foreclosure this holiday season, you should speak with a foreclosure defense lawyer in Oak Park as soon as possible. Contact the Emerson Law Firm to learn more about your options.

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Wells Fargo Admits to Hundreds of Wrongful Foreclosures
FHFA Report on Foreclosure Prevention

Thursday, November 8, 2018

Wells Fargo Admits to Hundreds of Wrongful Foreclosures

A number of erroneous foreclosures have been linked to Wells Fargo bank. Back in August 2018, Wells Fargo admitted that it had “accidentally foreclosed on” almost 400 homes due to a software glitch that denied homeowners the ability to seek mortgage modifications, according to a report from CBNC. This week, Wells Fargo announced again that it had “improperly foreclosed on 545 customers after wrongly denying them mortgage loan modifications, up from the 400 borrowers the company disclosed in August,” according to a recent article in Bloomberg.
While Wells Fargo is based in California, it provides mortgages to homeowners across the country, including in the Chicago area. What should Oak Park residents know about these “accidental foreclosures” and the harm caused by Wells Fargo’s actions? First, we want to provide some background information about the wrongful foreclosures that were reported in August, and then to speak to the new information this November about additional “accidental” foreclosures that have affected consumers and homeowners.
Alleged “Glitch” Results in Hundreds of Foreclosures That Should Not Have Happened
As the CNBC report explains, between 2010 and 2015, almost 400 Wells Fargo mortgage customers “lost their homes when they were accidentally foreclosed on after a software glitch denied them the ability to modify their mortgages as they sought federal aid,” In August, Wells Fargo “apologized” to those homeowners who were affected, and planned to remedy the serious errors by providing $8 million to customers who were impacted. According to Tom Goyda, the senior vice president of Wells Fargo, “during the course of an internal review, we determined that an automated calculation of error may have affected the decision on whether or not to offer or approve some mortgage modifications between April 13, 2010 and October 20, 2015, when the error was corrected.”
Goyda apologized for the “error” and said that Wells Fargo had plans to provide “remediation to the approximately 625 customers who may have been impacted.” While 400 homeowners actually lost their homes due to Wells Fargo’s mistake, as the report underscores, hundreds more were affected.
New Errors Revealed Regarding Wells Fargo Mortgage Accounts and Foreclosure
In August, Wells Fargo issued an apology to homeowners affected by its so-called “accidental” foreclosures and provided a remedy of $8 million, yet just this month, the bank again reported that nearly 150 additional homeowners were foreclosed on “accidentally” due to Wells Fargo errors. While the bank indicated that 625 customers in total had been affected when it made its announcement back in August, now it says that 870 customers in total actually were affected.
It is important to also underscore that these “accidental” foreclosures are not the only problem currently linked to Wells Fargo. The bank has been cited for improperly assessing fees on certain accounts, and fraudulently openning accounts for up to 3.5 million Wells Fargo customers who never wanted an account opened.
Learn More from an Oak Park Foreclosure Defense Lawyer
If you were one of the hundreds of homeowners with a Wells Fargo mortgage who faced foreclosure as a result of the bank’s error, you may be eligible for compensation. If you need assistance with foreclosure defense and keeping your home, you should speak with an advocate about getting started on your case. An experienced Oak Park foreclosure defense attorney can assist you. Contact the Emerson Law Firm for more information.
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Monday, October 22, 2018

FHFA Report on Foreclosure Prevention

Are foreclosure prevention methods working? According to a recent article in, the Federal Housing Finance Agency (FHFA) recently issued a new Foreclosure Prevention Report, which details recent foreclosure actions completed by Fannie Mae and Freddie Mac. The key information from the report is that Fannie Mae and Freddie Mac continue to complete tens of thousands of foreclosure prevention actions, and a high number of these are permanent loan modifications that allow homeowners to continue making lower payments on their mortgages for the life of the loan (which ultimately allows more homeowners to stay in those properties).
Even though the foreclosure crisis is now an issue that we discuss in terms of the recent past, homeowners in Oak Park and throughout the country continue to struggle with monthly mortgage payments. It is important for those homeowners to know that there may be options available to them to remain in their homes even if mortgage payments have become unmanageable.
Details of the Foreclosure Prevention Actions
What are some of the specific foreclosure prevention actions detailed in the report? In July 2018, the most recent period for data, “Fannie Mae and Freddie Mac completed just over 24,000 foreclosure prevention actions.” That number was slightly lower than the foreclosure prevention actions for June 2018, which totaled 25,363. In total, however, “since the beginning of the conservatorship in September 2008,” the government-sponsored enterprises have completed a total of 4,203,611 foreclosure prevention actions (or, in other words, more than 4.2 million).
More than half of those 4.2 million foreclosure prevention actions were permanent loan modifications. In July 2018, there were 18,874 permanent loan modifications, which means that Fannie Mae and Freddie Mac have completed a total of 2,254,644 permanent loan modifications since September 2008. The other types of foreclosure prevention actions include principal forbearance (about 22% of loans), and mortgage modifications that with extend-terms (about 56%).
What types of properties most often receive modifications? About 94% of the modifications are for primary residences, about 4% are for investment properties, and about 2% are for second homes.
Learning More About Foreclosure Prevention
In addition to foreclosure prevention actions taken by Fannie Mae and Freddie Mac, the FHFA report indicated that the number of short sales and deeds-in-lieu of foreclosure declined by 11% between June and July 2018, and the rate of “serious delinquency” also declined slightly. Short sales and deeds-in-lieu of foreclosure often are alternatives for homeowners who want to avoid foreclosure if they cannot find another way to stay in the property.
Given that subprime mortgages are no longer the major cause of foreclosures as they were during the crisis, what is driving new foreclosures? The report suggests that “23% of all delinquencies stem from a curtailment of income, which continues to be the top cause for delinquencies in general.” Other reasons for new foreclosures include unemployment, illness, and marital problems.
Contact an Oak Park Foreclosure Defense Attorney
If you have questions about avoiding foreclosure or if you want to learn more about foreclosure prevention, an experienced Oak Park foreclosure defense lawyer can speak with you today about options that may be available to you. Contact the Emerson Law Firm for more information.
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Friday, September 7, 2018

How to Slow Down the Foreclosure Process

Facing foreclosure can be devastating to a family or an individual homeowner in Oak Park and throughout Chicagoland. While the prospect of foreclosure can be anxiety-inducing, homeowners who are struggling to make mortgage payments should keep in mind that facing foreclosure does not necessarily mean that you will lose your home. There are many steps a homeowner can take to avoid foreclosure, especially with the help of an experienced Oak Park foreclosure defense attorney. A recent article in Forbes discusses methods for slowing down the foreclosure process, and we will go through those with you.
Understand the Foreclosure Process in Illinois
The first step to slowing down the foreclosure process or avoiding foreclosure altogether involves understanding how foreclosure in Illinois works. Illinois is a judicial foreclosure state, which means that, in order for the bank (or other lender) to move forward with a foreclosure, the bank needs to actually file a lawsuit in an Illinois court. Once you are served with the complaint, as long as you file an answer, the bank cannot obtain a default judgment against you. Throughout this time period, there can be ways to stop the foreclosure.
Contact the Lender for Options
Getting in touch with your lender may produce options for avoiding foreclosure. In most cases, lenders do not want to have to go through the foreclosure process. As such, you may be able to work with the lender to reach a solution. Some of those solutions can include refinancing your mortgage with lower payments that you can afford, getting on a repayment plan that allows you to make up missed payments while continuing to pay your mortgage, getting a forbearance to suspend your mortgage payments until you get back on your feet, or getting a loan modification.
File for Chapter 13 Bankruptcy
One of the benefits of filing for Chapter 13 bankruptcy is that a debtor who is struggling with mortgage payments may be able to use the bankruptcy to stop a foreclosure. How does this work? When a debtor files for bankruptcy, the automatic stay prohibits creditors from continuing to collect, and that includes mortgage lenders. Then, through the Chapter 13 bankruptcy repayment plan, debtors can reorganize mortgage debt and get back on track with mortgage payments in order to keep the home.
Consider Whether a Short Sale Could be Right for You
While a short sale does not allow a homeowner to keep his or her home, it can allow a homeowner to avoid a foreclosure. Choosing the option of a short sale is usually something a homeowner should only consider if there are not other options that would allow that homeowner to stay in the home, such as refinancing, a loan modification, or Chapter 13 bankruptcy.
Contact a Foreclosure Defense Attorney in Oak Park
If you are having difficulty paying your mortgage and are at risk of foreclosure, it is extremely important to get in touch with an Oak Park foreclosure defense lawyer who can help with your situation. Contact the Emerson Law Firm to learn more about different foreclosure defense strategies and options that may be available to you.
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Thursday, August 9, 2018

Illinois Foreclosure Rate Remains High While Chicago Takes Aim at “Zombie” Properties

If you are a homeowner in Chicagoland who has struggled with mortgage payments, or if you live in a neighborhood that was hit hard by the foreclosure crisis, you may know that the risk of foreclosure is not entirely over in Illinois. According to a recent article in the Illinois News Network, foreclosure rates are still declining in Illinois, yet some regions of the state continue to struggle when it comes to foreclosure activity.
In response to continued problems concerning foreclosure and neighborhood blight, there are financial institutions and nonprofit groups coming together in Chicago to “revitalize housing left behind in the foreclosure crisis,” according to a recent report from U.S. News & World Report.
Illinois Foreclosure Rate Remains Among the Highest in the U.S.
Over the last several years, the total number of foreclosures in Chicago and throughout the state of Illinois has largely declined. However, Illinois still stands out from other states when it comes to high rates of foreclosure. According to the Illinois News Network article, “while many of the home foreclosures from the recession era are long gone, Illinois’ overall foreclosure rate is still one of the highest in the nation.” For example, the foreclosure rates in Peoria and Rockford have some of the highest rates of foreclosure of any city in the country.
In the first half of 2018, there were more than 23,000 homes in Illinois that were in foreclosure. As of the end of July 2018, it was ranked fourth in the nation for highest foreclosure rates. When there are still so many homes in foreclosure, there is often not a lot of demand for real estate in the area. For many parts of Illinois, this reflects continuing economic problems where people cannot afford their mortgage payments or cannot afford to think about buying a home. Given the continued high rates of foreclosure in Illinois, it is important to think about two different issues: how to lessen the number of foreclosures that are currently vacant, and how to prevent foreclosure from happening in the future.
Ending and Preventing Foreclosure in Illinois
To stop new foreclosures from happening, some consumer advocates focus on increasing employment, thereby allowing Illinois homeowners to make their mortgage payments on time with the help of a regular paycheck or to save money in order to buy a home (perhaps one that is vacant due to foreclosure). For Chicagoland residents who do want to buy a home, what are the benefits of buying a property that is currently vacant due to foreclosure?
According to U.S. News & World Report, “several Chicago neighborhoods . . . needed an intervention after the foreclosure crisis peaked around 2010.” Many homeowners vacated residential buildings and single-family houses due to foreclosure. Those properties quickly became “so-called zombie buildings [that] were left empty and in disrepair.” In order to get those properties back to a state where they would be desirable and affordable to new homeowners, Chicago not only took part in HUD’s Neighborhood Stabilization Program (NSP), but it also “created the Micro Market Recovery Program (MMRP) to jump start individual blocks that had a high rate of vacant buildings due to foreclosures.” Community nonprofit groups and the Illinois attorney general’s office, the latter largely from settlements with financial institutions, have contributed to MMRP and funding will continue through the end of 2018. Since its inception, foreclosure filings in Chicago have declined by almost half.
Seek Advice from an Oak Park Foreclosure Defense Lawyer
Do you have questions about avoiding foreclosure? An experienced Oak Park foreclosure defense attorney can help. Contact the Emerson Law Firm to learn more about how we help consumers who are struggling with mortgage payments in Chicagoland.
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Friday, July 13, 2018

Illinois Homeowners are Avoiding Foreclosure

Fewer Illinois homeowners are at risk of foreclosure, according to a recent article in the Illinois News Network. More homeowners in Oak Park, throughout Chicagoland, and across the state are making their monthly mortgage payments on time, and rates of foreclosure are falling. While a decline in mortgage delinquencies is certainly a good thing for Illinois residents, it is important to remember that many homeowners in the state may be struggling yet might not recognize that they are at risk of foreclosure. What should Oak Park homeowners or potential homebuyers know about foreclosure in Illinois?
Foreclosure Starts are Down While Homeowners Pay Their Mortgages on Time
As the article clarifies, a recent report from Attom Data Solutions reports that “the number of Illinois homes that are being introduced into the foreclosure process fell 10% since May of last year.” That information correlates to fewer mortgage delinquencies and more homeowners who are making their mortgage payments on time. Some areas of Illinois have seen greater declines than others.
For example, foreclosure rates declined by 23% in Peoria from May of 2017, while foreclosure start rates in Rockford dropped by about 25%. Those in Champaign-Urbana dropped by the most salient amount—about 55%. Commentators suggest that these numbers are indicators of good financial health among homeowners in Illinois. According to Daren Blomquist, the Vice President of Attom Data Solutions, “foreclosure starts are a good barometer of the immediate financial condition of homeowners in Illinois.”
Home Equity is Helping Homeowners in Financial Difficulty
Why are fewer people at risk of foreclosure in the current economic climate? For the most part, people who purchased new homes after the foreclosure crisis have seen a rise in the values of their homes. As such, there are not too many new homeowners who are underwater on their loans. And rising home values also mean that homeowners who are finding themselves in financial trouble likely will be able to sell their properties for a profit in order to pay off debts.
In other words, when home values rise, more homeowners have equity in their homes that they can rely upon in the event of a financial emergency. As Blomquist suggested, homeowners in Illinois who lose their jobs or have unexpected medical bills will “typically have the equity in their home to get out of trouble.”
Foreclosure Remains a Risk in Illinois Despite Improving Numbers
While foreclosure start rates are declining, the state of Illinois “still has one of the highest foreclosure rates in the nation.” As such, it is important for homeowners to remain vigilant when it comes to their mortgage and their financial standing. According to an article from Freddie Mac, the following are warning signs that you could be at risk of foreclosure:

  • You have maxed out your credit cards;
  • You are relying on your credit cards to pay for daily expenses;
  • You are having trouble paying your bill on time;
  • You are making the minimum payment on your credit cards;
  • You are applying for new credit cards because you have maxed out your current cards; and
  • You are intentionally avoiding paying certain bills.
If you need help with foreclosure defense, an experienced Oak Park foreclosure defense attorney can speak with you today about your options. Contact the Emerson Law Firm for more information.
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