When you are struggling to make payments on your mortgage and are considering options to avoid a foreclosure sale of your property, such as a short sale or a deed in lieu of foreclosure, it is also important to understand how a consent foreclosure works. Illinois is a judicial foreclosure state, which means that the lender will need to file a foreclosure action in court and go through a judicial process before a foreclosure can be completed. When the lender must go through this extensive foreclosure lawsuit process, the lender will end up spending a significant amount of time and money on attorney’s fees and court costs. As such, the lender might consider alternate options to a judicial foreclosure in Illinois if you know you cannot get caught up on your mortgage payments.
While a short sale or a deed-in-lieu can be beneficial for many homeowners who are facing foreclosure, a consent foreclosure can also be beneficial to the homeowner. Our Oak Park foreclosure defense lawyers want to provide you with more information.
Why a Consent Foreclosure Can be Helpful to a Homeowner Facing Foreclosure
Anyone who is facing foreclosure should know that, if the lender wins a foreclosure lawsuit, not only can your home be seized and sold, but the lender can continue to pursue a deficiency judgment against you in order to recover the difference between the foreclosure sale price of the property and the amount you still owe on the mortgage. For example, if you have a mortgage and still owe $300,000 on that loan but the foreclosure sale results in the property being sold for only $200,000, the bank will be owed $100,000—the difference between the foreclosure sale price and the amount you owe on the mortgage. In such scenarios, the lender may be able to pursue a deficiency judgment in order to collect that remaining $100,000 from you.
However, the lender has an interest in saving the time and money associated with a foreclosure lawsuit. Accordingly, if you agree to the foreclosure—a consent foreclosure—the lender might agree to waive its right to seek a deficiency judgment in the event that the house sells for less than what you owe on the mortgage.
How Consent Foreclosures Work Under Illinois Law
Under Illinois law, the statute concerning consent foreclosures begins with the phrase “no objection.” The law clarifies that a court can enter a foreclosure judgment when the homeowner consents to the foreclosure if the lender agrees to waive its right to a deficiency judgment and if all affected parties consent to the entry of a foreclosure judgment.
It will be important to have an Oak Park foreclosure lawyer on your side during this process to ensure that the terms of the consent judgment are crafted properly and that you will not have to worry about the lender pursuing a deficiency judgment once the foreclosure judgment is entered.
Contact Our Oak Park Foreclosure Attorneys
If you have any questions about how a consent judgment works, or if you want to pursue other options to avoid foreclosure such as a short sale or a deed in lieu, one of our experienced foreclosure defense attorneys in Oak Park can speak with you today. Contact the Emerson Law Firm for more information.
See Related Blog Posts:
My Home is Going Into Foreclosure: Should I Consider a Short Sale or Deed in Lieu of Foreclosure?
Is a Mortgage Modification My Only Option to Avoid Foreclosure?