What is a Judicial Foreclosure and How Can I Avoid One?

When you are behind on your mortgage payments in Oak Park or elsewhere in Illinois, you may be concerned about the possibility of foreclosure and how it will affect your life and your credit. You might also know that you could be at risk of something known as a “judicial foreclosure,” but you may be unsure about what that means and whether any foreclosure you will face will be a judicial foreclosure. Our Oak Park foreclosure defense lawyers can provide you with more information about judicial foreclosures in Illinois, and we can tell you about potential options to avoid a judicial foreclosure, even if you must move out of your home and find a new residence.

Illinois is a Judicial Foreclosure State

The term “judicial foreclosure” refers to the way in which a property foreclosure occurs, and Illinois is what is known as a judicial foreclosure state. Accordingly, under Illinois law, all foreclosures are judicial foreclosure, which means that the bank must file a lawsuit in order to move forward with a foreclosure, and the court must ultimately allow the foreclosure to occur.

How does this process work? Typically, once you are late on your mortgage payments by 120 days or more, the lender will file a lawsuit and will ask the court to allow a foreclosure sale of the property to occur. As with any other lawsuit, the lender must serve you with the summons and complaint, and you must receive information about foreclosure law and consumer rights in Illinois. From that point, you will have 30 days to respond, after which point the lender will ask the court to allow the foreclosure sale to occur.

Options for Avoiding a Judicial Foreclosure in Illinois

Given that all foreclosures in Illinois must be judicial foreclosures under state law, any option for avoiding a judicial foreclosure is an option for avoiding foreclosure more generally in Oak Park. Once the judicial foreclosure process begins and you receive a summons and complaint, you may have multiple options to stop the foreclosure so that you will not have the foreclosure on your credit and can have a chance to rebuild your credit much faster than if the foreclosure occurs.

Common options for avoiding a judicial foreclosure in Illinois include:

• Short sale, which involves selling your property for less than the amount you owe on the mortgage with permission from the lender, and asking the lender to forgive the remaining amount; or
• Deed in lieu of foreclosure, which involves transferring over your property to the bank and, in most cases, asking the bank to forgive the amount you owe on the mortgage.

Seek Assistance from a Foreclosure Defense Attorney in Oak Park

If you are facing foreclosure and want to avoid a foreclosure sale, you may have multiple options available to you. One of our experienced Oak Park foreclosure defense attorneys can take a look at your circumstances today and discuss options for stopping the foreclosure. Contact the Emerson Law Firm today for more information about how we can help you with your case.


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What are the Steps for a Deed in Lieu of Foreclosure?

My Home is Going Into Foreclosure: Should I Consider a Short Sale or Deed in Lieu of Foreclosure?

When you are significantly behind on your mortgage payments, you may receive notice from the bank that your home is going into foreclosure. For many consumers who are struggling with mortgage debt, it is more important to avoid having the lender foreclose on the property than to remain in the property. Accordingly, in these situations, a homeowner might be considering two options for avoiding foreclosure — a short sale or a deed in lieu of foreclosure. You might have read about these options, but you may not be certain if either one is the right choice for you. While it is critical to work with a foreclosure defense attorney in Oak Park on any action you plan to take to avoid foreclosure, you can learn more about these options in the meantime.

Short Sales or Deeds in Lieu of Foreclosure Can Allow You to Avoid Foreclosure

Both short sales and deeds in lieu of foreclosure, the latter of which is often described simply as a “deed in lieu,” are options for avoiding foreclosure. As such, if your goal is to avoid foreclosure, either of these are possibilities that could be in your best interest. However, it is important to know that these options are distinct from one another and involve different processes.

If you are considering a short sale or a deed in lieu to avoid a foreclosure under Illinois law, you should know that short sales and deeds in lieu will still affect your credit. While neither short sales or deeds in lieu will impact your credit as significantly as a foreclosure, you will still see a noticeable dip in your credit score. So, should you choose a short sale or a deed in lieu? Our Oak Park foreclosure defense attorneys can provide you with details about each of these processes.

What is a Short Sale?

A short sale is a sale of your home in which you sell it to a third-party buyer (e.g., another consumer, someone who wants to use the property for rental income, or somebody who plans to do something else with the property), but you sell the home for less than the total amount you owe on your mortgage. For example, if you still owe $200,000 on your mortgage, you might sell the house for $150,000 in order to avoid foreclosure. However, the bank must agree to the short sale before you can complete the transaction. After the bank agrees to the short sale, you will typically need to submit an application for loss mitigation.

It is important to work with a lawyer who can ensure that the bank has agreed to the short sale and has also agreed to forgive the remaining debt not covered by the short sale proceeds. However, you should be aware that any forgiven debt will likely count as taxable income, and you will be responsible for paying taxes on that amount the same way you would any other income.

What is a Deed in Lieu?

With a deed in lieu, rather than selling your house to repay some of the amount you still owe, you agree to transfer the title of your home to the bank. Like a short sale, you will need to get the bank’s approval for a deed in lieu before it can happen. However, you can still be responsible for the difference between the amount owed on your mortgage and the fair market value of your home.

Contact Our Foreclosure Defense Lawyers in Oak Park

If you have questions about avoiding foreclosure through a short sale or deed in lieu, our Oak Park foreclosure defense attorneys can help. Contact the Emerson Law Firm today.



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How Long Can Foreclosure Suspensions Last?

Foreclosures Suspended Due to Coronavirus

If you are struggling to make mortgage payments amidst the coronavirus crisis, you should know that you are not alone. Many homeowners are struggling with business closures and job loss, making it difficult and even impossible to pay monthly mortgage payments. For many homeowners who were already struggling, the coronavirus outbreak is exacerbating financial problems that already existed. According to a recent report in CNN, the federal government will put a hold on certain foreclosure activity due to coronavirus until the end of April.

Single-Family Homes and Foreclosure Halt Until End of April
If you have a mortgage on a single-family home and that mortgage is a Federal Housing Administration-insured mortgage, you will not be at risk of foreclosure until the end of April. According to the report, Trump indicated that “the Department of Housing and Urban Development is providing immediate relief to renters and homeowners by suspending all foreclosures and evictions until the end of April.”

HUD Secretary Ben Carson explained that the temporary suspension of foreclosure activity “will allow households who have an FHA-insured mortgage to meet the challenges of COVID-19 without fear of losing their homes, and help steady market concerns.”

Ways of Avoiding Foreclosure
While homeowners who are struggling to make monthly mortgage payments can have some relief from the news that foreclosure activity on FHA-insured mortgages will be put on hold until the end of April, it is still important to think about ways to stop foreclosure from that point onward. Temporary relief is important for homeowners, but anyone who is struggling to make mortgage payments and is at risk of losing their home should work with a foreclosure defense attorney to make a longer-term plan. An article in Bankrate cites the following ways that struggling homeowners can stop a foreclosure:

• Contact the lender to find out about your options: While homeowners often assume that the lender will not provide any relief—and this certainly may be true in a number of cases—it is important to keep in mind that lenders do not want to go through a foreclosure process if they can find a way to be repaid by working with the homeowner. If a lender thinks a homeowner may be able to get back on track with mortgage payments through refinancing or a loan modification, for example, the lender may offer these or other options for loss mitigation.
• Loan modification: Like we mentioned above, a mortgage lender or servicer often has the ability to provide homeowners with a loan modification to lower monthly mortgage payments. A modification can involve lowering the interest rate or shifting the terms of the loan.
• Deed-in-lieu of foreclosure: This is not an option that allows a homeowner to stay in the home, but it can prevent a foreclosure. With a deed-in-lieu of foreclosure, the homeowner gives the property back to the lender to avoid the foreclosure.
• Short sale: This is also an option that requires the homeowner to leave the home, but it can prevent a foreclosure from affecting the homeowner’s credit. With a short sale, the lender allows the homeowner to sell the house for an amount that is less than what they owe on the mortgage, and the lender agrees to forgive the remaining amount.
• File for Chapter 13 bankruptcy: This is an option that allows a homeowner to stay in the home and to catch up on mortgage payments. With a reorganization bankruptcy, the automatic stay will stop the foreclosure from happening and will allow the homeowner to create a repayment plan for repaying the lender.

Contact an Oak Park Foreclosure Defense Lawyer
If you have questions about preventing foreclosure, an Oak Park foreclosure defense attorney can assist you today. Contact the Emerson Law Firm for more information.


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How the Foreclosure Crisis Continues to Affect Single-Family Homes

Recent Court Case Addresses Role of Third-Party Buyers in Foreclosure Sales

If an Oak Park resident’s home goes into foreclosure, there are a number of steps that exist before the property goes through the process for a judicial foreclosure and the home is sold. Since Illinois is a judicial foreclosure state, all foreclosures go through the court system. However, in some cases, the homeowner is continuously taking action to attempt to retain possession of the home and to stop the foreclosure. What happens when a judgment of foreclosure is entered and the house is sold to a third party, but the homeowner appeals the judgment in an attempt to keep the property?

That is the basis for a recent case that went before the First Appellate District of Illinois, Deutsche Bank National Trust Co. v. Roman (2019). According to a recent article in DSNews.com about the case, the court had to determine whether a third-party buyer is a party to the foreclosure case, and whether an appeal can reverse a foreclosure judgment and sale. The court ruling could have implications for other foreclosure judgments and sales in the Oak Park area.


Getting the Facts About the Case

As the court explained in the background of the case, the matter had “a long litigation history.” We want to provide some basic facts about the background to make clear how the court reached its conclusion. In short, the defendants, Cesar and Irene Romans, owned a residential property in Chicago that went into foreclosure. The bank initiated the foreclosure process, and after approximately a year and a half, the court entered a judgment of foreclosure and sale.


The Romans appealed, and the case went through a lengthy litigation process. More than four years after the court entered the judgment of foreclosure and sale, a judicial sale of the property was scheduled. The Romans attempted to stop the judicial sale, arguing that they never received a grace period notice and that they never received a proper notice of default. The lower court agreed to an emergency motion to stay the sale of the property, but the court ultimately found against the Romans and permitted the sale to move forward a couple of months later. The buyer of the property was a third-party buyer unconnected to the foreclosure case. The Romans continued to appeal the judicial sale.


The plaintiff argues that the Romans’ appeal is moot because the property already had been conveyed to a third party under Illinois Supreme Court Rule 305(k).


Does a Third Party’s Acquisition of Property Render an Appeal Moot?

In the present case, the court had to determine whether a third party’s acquisition of the property in question rendered the appeal moot under Rule 305(k), and thus whether the third party was a “party to the foreclosure proceedings,” according to the article.


The court ultimately concluded that a third party buyer in a judicial foreclosure sale is not a party to the lawsuit, and that public policy behind Rule 305(k) is to prevent a third party from “losing [a] property due to facts unknown to him at the time of the sale.” Accordingly, the court clarified that, in a foreclosure case where the third party buyer has no other stake in the foreclosure proceedings than as a purchaser, an appeal from the former homeowners who went through the foreclosure process is moot under Rule 305(k).


Contact an Oak Park Foreclosure Defense Lawyer

An Oak Park foreclosure defense lawyer may be able to help you to stop a foreclosure at various points in the process. Contact the Emerson Law Firm today to learn more about your options.


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How the Government Shutdown has Affected Foreclosures
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How the Government Shutdown has Affected Foreclosures

Just because the government shutdown is over does not mean that it is not having lingering effects; its effects are still being felt among government employees and consumers across the country. One area in which the government shutdown is still plaguing consumers concerns homeowners working on foreclosure avoidance and homeowners who are in government mortgage programs. How is the shutdown continuing to impact these groups of people? In short, during the government shutdown, many employees from the U.S. Department of Housing and Urban Development (HUD) were furloughed, meaning that they were in effect sent home from work without pay. As you might recall, the government shutdown lasted over a month.

During that time, people who were relying on HUD services to avoid foreclosure did not get the help they needed, according to a recent article in The Hill. And that lack of help has now put a significant number of homeowners at risk of losing their houses.

How the Government Shutdown Affects Homeowners Who Need Mortgage Help
During the government shutdown, a large number of HUD workers were furloughed, which meant that those workers could not handle cases related to foreclosure—from requests for modifications to questions about foreclosure cases that already have been started. As a result of being unable to handle new cases coming in and questions pertaining to existing cases, many HUD employees returned to work once the shutdown ended to find that cases “piled up while critical agency resources were unavailable.”

The fact that so many HUD workers were furloughed also means that they were unavailable to provide information to homeowners who are facing foreclosure this month. Indeed, according to the article, one elderly woman had been working with a HUD representative prior to the shutdown after being wrongfully denied entry into a foreclosure avoidance program for newly widowed spouses by her lender. But because no one at HUD could help that woman during the month of January—a critical time for her case, which is coming up for foreclosure this month in February—she may now be at much greater risk of losing her home.

This particular example is only one of many related to the lingering harms of the government shutdown on homeowners hoping to avoid foreclosure.

Millions of Borrowers may Have Been Affected by the Shutdown
The article underscores that more than nine million borrowers currently have mortgages provided by, or insured by, government agencies including HUD or the U.S. Department of Agriculture (USDA). The majority of these homeowners are “low-income, seniors, and/or residents of rural areas.” That is to say that most of these homeowners do not have other places to turn for help in avoiding foreclosure. If the government agency that handles their mortgage is closed, then most of those homeowners simply do not get help or answers to their questions. While many HUD employees were furloughed, so were employees at the USDA.

Currently, the article suggests that “thousands” of homeowners likely may lose their homes in the near future due to the shutdown—had HUD and the USDA been open, those homeowners would not be facing foreclosure today. Since the government shutdown lasted for such a long time, there is currently a “substantial backlog of requests for assistance,” which means that those same homeowners may not be able to obtain help from HUD or the USDA any time soon.

Consumer protections advocates argue that the agencies should extend foreclosure deadlines by the same amount of time as the government shutdown and should “issue a stay on foreclosures until they clear the backlog of pending requests for assistance.” Whether such steps will be taken remains to be seen.

Contact an Oak Park Foreclosure Defense Lawyer
In the meantime, if you need help avoiding foreclosure, an Oak Park foreclosure defense attorney can assist you. Contact the Emerson Law Firm to learn more.


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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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What is a Judicial Foreclosure State?

According to a recent article in The Patch, Illinois had one of the highest rates of foreclosure in the country in 2017. Indeed, Illinois came in fourth for the total number of foreclosure filings last year, yet foreclosures overall dropped significantly. In total, Illinois had a foreclosure filing rate of 0.86% of the total number of housing units in the state, which still shows a decline from the previous year. In other words, foreclosure rates are declining in Illinois, yet they are still among the highest in the nation. As you have read about foreclosures in Oak Park and throughout Chicagoland, you might have come across the term “judicial foreclosure.”

Given that many homeowners in the state are still facing foreclosure, it is important to understand the difference between a judicial and a non-judicial foreclosure, and what this means for homeowners in Illinois.

Two Types of Foreclosures in the U.S.

In the country, there are two different types of foreclosures - judicial and non-judicial foreclosures. You may have heard of or seen references to judicial foreclosures in Illinois, and this is because Illinois is a judicial foreclosure state. What does this mean? It is actually a relatively simple premise: Foreclosures need to go through the court system. Other states are what are known as non-judicial foreclosure states, and as such, foreclosures do not have to go through the court.

Judicial and non-judicial foreclosures have different processes. While the basic difference between them is relatively easy to understand, it is important to carefully consider the distinctions between these two types of foreclosures and the way they affect homeowners. Since Illinois is a judicial foreclosure state, we will focus on what that means for mortgage borrowers who may be behind on payments.

How do Judicial Foreclosures Work?

For a judicial foreclosure to begin, the bank (the lender of the mortgage) needs to file a lawsuit. Because judicial foreclosures go through the court system, they tend to take a significantly longer period of time than non-judicial foreclosures. Under foreclosure laws, the following are typically the steps in a judicial foreclosure:

• The bank first needs to send a notice of its intent to begin the foreclosure process after you get behind on your mortgage payments by 120 days or more;
• The bank will file a lawsuit if you do not attempt to make payments on the mortgage debt you owe;
• Homeowner receives notice of the lawsuit and can respond, which is the point at which the homeowner can raise defenses to the foreclosure; and
• If the bank wins the lawsuit, the court will enter a judgment for the bank and a foreclosure sale usually will occur.

About half of all U.S. states are judicial foreclosure states. In non-judicial foreclosure states, the foreclosure process does not go through the court and thus is typically much quicker. It usually involves the homeowner receiving a notice of default and a notice of sale before the foreclosure sale occurs.

Contact an Oak Park Foreclosure Defense Attorney

Do you need help with foreclosure defense, or do you have questions about the foreclosure process in Illinois? An experienced Oak Park foreclosure defense lawyer can help. Contact the Emerson Law Firm for more information.

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Assessing the Risks of a New Foreclosure Crisis

The foreclosure crisis that began in 2007 has now been over for a number of years, yet we have continued to discuss commentators’ concerns that the foreclosure crisis might not, in fact, be over entirely. Many homeowners in the Chicago area remain at risk of losing their homes due to their inability to make monthly mortgage payments on time, and many of those homeowners are dealing with complicated home loans that contain confusing terms. According to a recent article in Forbes Magazine, we may be at risk of another foreclosure crisis. Are the underlying reasons the same this time around? What can we do to prevent another consumer crisis?

Recalling the Reasons for the Housing Bubble Burst in 2007

As the Forbes article explains, most of us directly connect the foreclosure crisis that began about 10 years ago to the housing bubble burst and the subsequent “Great Recession.” What caused the foreclosure crisis the bursting of the housing bubble? In short, “for years beforehand, lenders had been giving out riskier and riskier mortgages, including waiving or lowering down payment requirements.” In addition, subprime mortgage resulted in numerous homeowners finding themselves underwater, or owing more money on their mortgages than their houses were actually worth on the market, meaning that even if they were to sell their properties, they would owe more money to the bank than they could afford.

Are we looking at similar conditions now, in 2017? The article suggests that “low- or no-down-payment mortgages may be making a comeback.” In other words, more homeowners that cannot actually afford to make monthly mortgage payments may be getting home loans that they could be at risk of defaulting on months or years down the road. Indeed, “several banks are now offering various zero-down mortgage programs or down payment assistance to higher-risk borrowers.” But the problem is not exactly the same as it was in the early 2000s. In large part, adjustable-rate mortgages have been linked to the first foreclosure crisis. Now, a different kind of loan may be responsible for consumer difficulties.

Down Payments Taxed as Income

One of the types of down payment assistance that is gaining popularity is a type of home loan that involves the bank providing for a 3% down payment and, in some cases, closing costs. While this deal might sound good to struggling families who want to buy a house, this kind of down payment assistance has hidden costs that many borrowers might not fully grasp. Specifically, “the down payment and closing costs can be taxed as income by the IRS.” What does this mean for the average low-income or moderate-income borrower?

If a 3% down payment and up to $3,500 are taxed as income, that could mean homebuyers could end up in a higher tax bracket, owing significant taxes as a result of making the decision to buy a home. For example, imagine that a borrower wants to buy a $200,000 home. A 3% down payment would total $6,000, and add the $3,500 closing costs to that amount for a total of $9,500. Now, the borrower would be taxed on that amount, adding thousands of dollars in the total tax owed for the year. For many low-income and moderate-income borrowers, this kind of tax bill could be debilitating, adding to additional debt issues.

Contact a Foreclosure Defense Lawyer in Oak Park

Do you have questions about current mortgage offers and foreclosure risks? An Oak Park foreclosure defense attorney can assist you. Contact the Emerson Law Firm for more information.

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Recent Case Addresses Illinois Single Refiling Rule for Foreclosure

A recent case before the Appellate Court of Illinois clarified how the Illinois single refiling rule (735 ILCS 5/13-217) applies in certain foreclosure actions. In brief, the case of Wells Fargo Bank v. Norris involved a mortgagor who argued that the bank’s third attempt to file a foreclosure action was barred by the Illinois single refiling rule. The facts of the case are long and drawn-out, but we will give you a basic set of facts in order to understand the outcome of the case. In the meantime, it is important to begin by looking at the Illinois single refiling rule and how it functions with regard to foreclosures in the Chicago metropolitan area.

Illinois Single Refiling Rule: How Does it Affect Foreclosure Actions?

What is the Illinois single refiling rule, and how does it affect foreclosure actions? In basic terms, the Illinois single refiling rule exists to prevent a bank or mortgage company from dismissing a foreclosure action and later refilling multiple times. In the 2015 case United Central Bank v. KMWC 845, LLC, the Seventh Circuit Court of Appeals clarified that actions to enforce a mortgage default cannot be refiled more than one time.

That case also clarified that, when a refiling based on a promissory note is not allowed under the Illinois single refiling rule, the bank cannot refile an action based on the mortgage default. In other words, refiling a foreclosure action—based on the promissory note or the mortgage—can only happen once for each case. Now that you have a clearer sense of how the Illinois single refiling rule works, we can take a closer look at the recent case.

Appellate Court of Illinois Permits Third Filing in Recent Case

Under the Illinois single refiling rule, a third filing by a bank should be illegal, right? In the recent case, however, the Appellate Court of Illinois ruled that Wells Fargo’s third attempt to filing a foreclosure action was not barred by the Illinois single refiling rule. How did it come to this conclusion? To better understand, let’s examine the facts of the case.

As we mentioned, this case has a long history. However, we will summarize some of the key facts for you. In this case, the mortgagor (the defendant) had been married back in 2008. At that time, his then-wife signed a promissory note for a mortgage. The defendant did not sign that, but did sign a mortgage agreement. The couple went into default in 2008, and the bank, Wells Fargo, filed a foreclosure action. Shortly thereafter, Wells Fargo voluntarily dismissed the foreclosure action because it learned that the defendant and his wife had obtained a mortgage modification. The defendant and his wife allegedly defaulted on the mortgage modification, and Wells Fargo again filed a foreclosure action. However, the defendant disputed that he had ever agreed to a modification, and thus Wells Fargo again voluntarily dismissed the second foreclosure filing because it presumed the modification was unenforceable.

Now we get to the final foreclosure filing—the third foreclosure filing against the defendant. Wells Fargo filed this third action, but it was a filing for the original default from 2008. The defendant argued that the Illinois single refiling rule prohibited a third filing (or second refiling). The court, however, did not agree.

The court determined that the second foreclosure filing (connected to the mortgage modification default) was a new filing altogether—it was not a refiling of the first foreclosure action. As such, the third filing was in fact the first refiling (of the original foreclosure action for the 2008 default). As such, the court concluded that Wells Fargo was not in violation of the Illinois single refiling rule when it filed its third foreclosure action.

Consult an Oak Park Foreclosure Defense Lawyer

The Illinois single refiling rule can be confusing, and this recent case emphasizes how complicated the law can be. If you have questions, an Oak Park foreclosure defense attorney can help. Contact the Emerson Law Firm for more information.

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Foreclosures Down Nationwide, But Not in Illinois

Each month, consumers across the country encounter news about the continuing decline of foreclosures. While such news typically suggests a stronger economy than in the years immediately following the foreclosure crisis, the state of Illinois has not yet fully bounced back. Or, at least, it remains among the hardest-hit states for foreclosure activity. According to a recent report from DSNews.com, an April 2017 Foreclosure Market report from ATTOM Data Solutions indicated that foreclosures nationwide have “now reached their lowest point since late 2005,” yet that decline is not as evident in Illinois.

Declining Foreclosure Rates Across the Country

In general, foreclosure rates continue to decline. As the recent report explains, foreclosure rates were down 23% from April 2016, meaning that foreclosure rates are actually at the lowest they have been since 2005. In total, there were just over 77,000 foreclosure filings in April 2017. This number “includes all default notices, bank repossessions, and scheduled auctions.” To put that number another way, around one out of every 1,723 homes (or about 0.06 percent) was in foreclosure last month. Less than 1% of all homes nationwide were in some state of foreclosure as of the end of the month.

However, not all states have equally low foreclosure rates. Indeed, the low number we cited above is a nationwide average, which includes states where foreclosure rates are even lower than the figure we mentioned, as well as those in which the foreclosure rates may be significantly higher. Unfortunately, Illinois is a state that falls into the latter grouping.

Illinois Has Fifth-Highest Foreclosure Rate in the Country

When it comes to states that are still dealing with high rates of foreclosure, Illinois is not the worst among them. At the same time, however, the report notes that it has the fifth-highest foreclosure rate in the country. Here are the numbers for the states that made the “top five” in terms of foreclosure activity:

• New Jersey’s Atlantic City metro area (1 out of every 237 homes in foreclosure);
• Delaware (1 out of every 706 homes in foreclosure);
• Maryland (1 out of every 776 homes in foreclosure);
• Connecticut (1 out of every 956 homes in foreclosure); and
• Illinois (1 out of every 1,083 homes in foreclosure).

Some other notable cities with high foreclosure rates were Fayetteville, North Carolina, Trenton, New Jersey, Rockford, Illinois, and Philadelphia, Pennsylvania. Are these numbers really a reason to worry? When you look at the total number of homes in foreclosure in Illinois, 1 out of every 1,083 sounds bad. However, when we think about he percentage (about 0.09%), that number does not seem so high. The good news is that, when it comes to repeat foreclosures, the Chicago area is not mentioned as one of the regions with a high rate.

Contact an Oak Park Foreclosure Defense Lawyer

Given that Chicago foreclosure rates remain high compared to other states across the country, it is important to learn more about avoiding foreclosure if you are behind in mortgage payments. An experienced foreclosure defense attorney in Oak Park can help. Contact the Emerson Law Firm today to learn more about how we can assist you.

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