Top Things to Know About a Short Sale to Avoid Foreclosure

Realizing that your home is at risk of foreclosure can be incredibly stressful, and our Oak Park foreclosure defense attorneys know how difficult it can be to understand your options under these circumstances. One common way to avoid foreclosure is the short sale, and our firm routinely represents clients in short sales in the Chicago area. What do you need to learn about short sales and how they work? The following are some of the top things to know about a short sale to avoid foreclosure.

Short Sales Stop Foreclosure

The first and most important thing to know about a short sale is that it is an option for avoiding foreclosure. What is a short sale? As Rocket Mortgage explains, the term “short sale” refers to selling your house for less than the amount that you currently owe on the mortgage in order to prevent the home from going into foreclosure. A short sale does not allow a homeowner to remain in the property since they will be selling it, but it does offer an option for avoiding the damage to your credit that would come with a completed foreclosure. Short sales do still impact your credit, but not to the extent of foreclosures.

Short Sales Require Agreement From the Bank or Lender

A short sale requires the homeowner to get permission from the bank or lender in order to move forward. Since you will be selling your home for less than what you owe on the mortgage, the lender has to agree to the amount that the home will be sold for and must agree to the overall sale. Short sales are often beneficial to lenders when a homeowner has an underwater mortgage and cannot continue making payments because the lender may be able to get more money for the home than they would with a foreclosure. A foreclosure defense lawyer in Oak Park can work with your lender to secure approval for the short sale.

Short Sales Do Not Leave You at Risk of a Lawsuit for the Remaining Amount Owed

With a short sale agreement, your attorney will also typically have the lender agree to forgive any remaining debt you owe on the mortgage as a result of the short sale. As such, you will not have to worry about being sued for the remaining amount owed. You may, however, owe taxes on the amount forgiven.

Contact an Oak Park Foreclosure Defense Attorney

Are you currently at risk of foreclosure and wondering about your options? You may have multiple options available to you, but a short sale is frequently a good option for homeowners who want to avoid foreclosure but know they do not have options for remaining in their homes. Whether you want to learn more about a short sale and receive legal help with the process, or you want to find out about other options for avoiding foreclosure, you should get in touch with one of the experienced Oak Park foreclosure defense lawyers at our firm. We have years of experience representing consumers and homeowners in the Oak Park area, and we can speak with you today. Contact the Emerson Law Firm to find out more about how we can help you with foreclosure defense options.



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Am I Eligible for an Option to Avoid Foreclosure?

Delinquent Mortgages Decline While Foreclosures Rise

Am I Eligible for an Option to Avoid Foreclosure?

Foreclosures are on the rise again in Chicago. While the numbers are not as high as they were during the foreclosure crisis that began nearly 15 years ago, the rates of foreclosure are creeping up, and they are attracting particular attention in major urban areas, including Chicago. Indeed, according to a recent report in Bloomberg, foreclosure starts rose by 22 percent in the first quarter of 2023 compared with numbers from the first quarter of last year, and Chicago has the second-highest rate of new foreclosure starts in the country. In the first quarter alone, there were more than 3,500 foreclosure starts in the Chicago area, a number that makes Chicago second only to New York City in terms of foreclosure starts.

If you are at risk of foreclosure, or if you are already facing foreclosure, what are your options for avoiding it? And should you even be taking steps to avoid it, or should you merely allow the foreclosure to happen and then attempt to get your credit back on track later?

You Should Do Everything You Can to Prevent Foreclosure

Many people who are struggling with debt and are facing foreclosure make the decision to simply allow the foreclosure to happen, but it is almost always beneficial to take steps to avoid foreclosure, and an experienced foreclosure defense attorney can help you with your options.

Why should you try to avoid foreclosure if you can? Not only does foreclosure always result in the loss of your home, but it can also have a substantial impact on your credit — significantly more than some of the options that may be available to you to avoid foreclosure — and it can result in you facing a lawsuit for the bank to recover the money you owe and the loss of any equity in your property. In short, if you can avoid foreclosure, you should.

Ways to Avoid Foreclosure in Illinois

There are many potential ways to avoid foreclosure, and our Oak Park foreclosure defense attorneys routinely assist homeowners with a range of tools for preventing foreclosure in Illinois. The following are just some of the options that could be relevant to your situation:

• Showing that your mortgage servicer or lender violated the law or made an error, and you should not actually be in a situation where you are facing foreclosure;
• Doing a short sale, which requires getting permission from the lender to sell your home at a price below what you owe and asking the lender to forgive the remaining amount;
• Deed in lieu of foreclosure, which involves turning over the deed to your house or apartment to the bank to prevent the bank from foreclosing; or
• Filing for Chapter 13 bankruptcy, if you are eligible, which can actually allow you to catch up on mortgage payments and keep your home.

Contact an Oak Park Foreclosure Defense Attorney

Are you struggling with your mortgage payments and at risk of foreclosure? Now is the time to get in touch with an experienced Oak Park foreclosure defense lawyer who can learn more about your specific circumstances and can discuss different types of foreclosure defense options with you. For many struggling homeowners, there are ways to avoid foreclosure, and our firm can help. Contact the Emerson Law Firm for more information and to speak with an attorney.



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Delinquent Mortgages Decline While Foreclosures Rise

Foreclosure Rates Continue Uptick

Delinquent Mortgages Decline While Foreclosures Rise

Foreclosure rates tend to be higher in times of economic downturn, and many commentators anticipated that the number of foreclosures across the country would start to increase as moratoriums ended and the financial impact of the COVID-19 pandemic became a reality. Recent data has shown upticks in overall foreclosure rates throughout the United States, with particular spikes in certain urban areas, including in the Chicago area. According to a recent article in DSNews.com, new statistics show that the overall rate of mortgage delinquencies has declined, but the rate of foreclosures continues to climb. What should you know about recent data on foreclosures? And what should you do if you believe you are at risk of foreclosure? Consider the following information from our Oak Park foreclosure defense attorneys.

Drop in Mortgage Delinquencies Coincides with Increase in Foreclosures

In comparison with mortgage delinquency and foreclosure data from a year ago, the news is good in terms of overall mortgage delinquency rates. Indeed, according to the DSNews.com report, as of January 2023, approximately 2.8% of mortgages in the United States “were in some stage of delinquency,” meaning that they were at least 30 days past due, with some already in the foreclosure process. While that percentage might seem high, it actually represents a 5% decrease from the same time last year in January 2022, when about 3.3% of mortgages were in a stage of delinquency. However, the data does not look as good for foreclosures.

Between January 2022 and January 2023, overall rates of foreclosure have actually increased. In January 2022, approximately 0.2% of all homes were in foreclosure, and by January 2023, that number had risen to 0.3%. While the change might not seem significant since the number is small, the rise is notable given the decline in mortgage delinquencies over the same period.

Avoiding Foreclosure: What are My Options?

If you are behind on your mortgage payments and are at risk of foreclosure, what are your potential options for avoiding foreclosure? You may have a few different options, and you should discuss them with a foreclosure defense attorney in Oak Park. Some possible options include, for example:

• Filing for Chapter 13 bankruptcy, which can allow you to stop the foreclosure process from occurring or moving forward, and can allow you to get caught up on mortgage payments through debt reorganization;
• Short sale, which is a process through which the lender agrees for you to sell your house for less than you owe on the mortgage and to forgive remaining debt; or
• Deed in lieu of foreclosure, in which you would sign over your deed to the house to the lender in order to avoid foreclosure.

Contact a Foreclosure Defense Lawyer in Oak Park

Anyone who is at risk of foreclosure or for whom foreclosure proceedings have already begun should get in touch with an experienced Oak Park foreclosure defense attorney who can help. Our firm can assist you with multiple options that may allow you to avoid foreclosure, from a reorganization bankruptcy that could allow you to stay in your home to a short sale or deed in lieu that could prevent your credit from being impacted fully by a foreclosure. Contact the Emerson Law Firm to learn more about potential options for avoiding foreclosure in Illinois.



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Foreclosure Rates Continue Uptick

Wells Fargo Fined for Wrongful Foreclosures

Wells Fargo Fined for Wrongful Foreclosures

Are you currently facing foreclosure, or was your home foreclosed on as a result of actions taken by Wells Fargo? If so, it is critical to learn more about recent actions taken by the Consumer Financial Protection Bureau (CFPB) against the bank for unlawful acts, including wrongful foreclosures. Last month, the CFPB announced in a news release that it was ordering Wells Fargo “to pay more than $2 billion to redress consumers and a $1.7 billion civil penalty for legal violations across several of its largest product lines.” Indeed, according to the news release, “the bank’s illegal conduct led to billions of dollars in financial harm to its customers and, for thousands of customers, the loss of their vehicles and homes.” Our Oak Park foreclosure defense lawyers want to provide you with more information about the recent action taken against Wells Fargo and the specific issue of wrongful foreclosures.

Wrongful Fees and Misapplication of Payments

How did Wells Fargo’s actions result in wrongful foreclosures? As the news release from the CFPB explains, “consumers were illegally assessed fees and interest charges on auto and mortgage loans, had their cars wrongly repossessed, and had payments to auto and mortgage loans misapplied by the bank.” In other words, foreclosures resulted from homeowners being improperly charged fees and interest that they could not pay and from homeowners’ mortgage payments being improperly applied to their mortgage debt.

In addition to misapplying payments and charging unlawful interest or fees, Wells Fargo was also cited for improperly denying mortgage modifications to homeowners, which could have prevented foreclosures in some cases. The CFPB’s news announcement specifically notes that the bank’s improper denial of modifications—a number in the thousands—led, in some cases, “to Wells Fargo customers losing their homes to wrongful foreclosures.”

CFPB Enforcement Action

According to CFPB Director Rohit Chopra, “Wells Fargo’s rinse-repeat cycle of violating the law has harmed millions of families . . . . The CFPB is ordering Wells Fargo to refund billions of dollars to consumers across the country. This is an important initial step for accountability and long-term reform of this repeat offender.”

In order to remedy the variety of improper and unlawful actions taken by Wells Fargo, the CFPB has taken a series of enforcement actions. Not only will the bank be required to pay more than $2 billion, but it will also need to pay penalties and change the process for assessing certain types of fees.

Contact an Oak Park Foreclosure Defense Lawyer Today

If you are facing foreclosure, you should get in touch with an experienced Oak Park foreclosure defense attorney who can discuss your options with you. Depending upon your circumstances, you could be eligible to consider a short sale, a deed in lieu of foreclosure, and other options. If you faced an unlawful foreclosure, or if you believe you are currently facing an unlawful foreclosure like those discussed above, our firm is also able to assess your case and provide you with more information about your options. Do not hesitate to get in touch with our firm to find out more about how we can help. Contact the Emerson Law Firm today.



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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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How Long Can Foreclosure Suspensions Last?

For homeowners in Oak Park and across the country, the suspension of evictions and foreclosures during the pandemic has meant that concerns about losing a home due to the inability to make mortgage payments have not loomed as prominently as they likely would have given the effects of COVID-19 on the economy. However, each time the eviction and foreclosure moratoriums have been extended, they have had a clear end date. According to a recent CNN article, struggling homeowners should begin making plans to ensure that their homes do not go into foreclosure when the current moratorium expires. As that article underscores, foreclosure suspensions simply cannot last forever.

Consider the Current Moratorium

The initial eviction and foreclosure moratoriums that went into effect early on in the pandemic were extended, but homeowners should keep in mind that expiration dates are not too far in the future. The current foreclosure moratorium will expire at the end of June 2021, and the current statistics are grim when it comes to struggling individuals and families who could be at risk of losing their homes. As the article underscores, there are about “six million families behind on their rent and three million behind on their mortgage.”

What will happen to struggling homeowners with the expiration of the foreclosure moratorium? Eligible homeowners currently can have a forbearance of up to 18 months, with unpaid mortgage payments during that time period getting added onto the total amount of the mortgage so that the payments are made up later on. Some homeowners will be eligible to seek a mortgage modification so that their monthly payments are lowered. In addition, according to the article, “Congress has appropriated $10 billion in mortgage payment relief, which will likely go towards deeper assistance for those for whom the existing relief isn’t enough.”

Options for Homeowners When the Moratorium Ends

When the foreclosure moratorium ends and mortgage payments are due, what options will homeowners have if they still have not recovered financially from the pandemic and have not been able to find employment? Generally speaking, homeowners may be able to consider similar foreclosure-prevention options that were available prior to the pandemic, from mortgage modifications to the possibility of filing for Chapter 13 bankruptcy. Yet it is important to remember that Chapter 13 bankruptcy is only an option for staying in your home and avoiding foreclosure if you have an income and are able to show that you can make the payments associated with your debt repayment plan.

Struggling homeowners should also speak with a foreclosure defense attorney about additional relief options that may become available by the time mortgage payments are due. Your foreclosure defense lawyer can discuss the variety of options that may be available to you to avoid foreclosure and can help you with a Chapter 13 bankruptcy filing if that is the best option for you and your family.

Contact Our Oak Park Foreclosure Defense Lawyers

Do you need assistance avoiding foreclosure? Our Oak Park foreclosure defense attorneys are here to help. Contact the Emerson Law Firm for more information about preventing foreclosure and remaining in your home.



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Extended Foreclosure Moratorium Will Help Homeowners

Foreclosure Ban Extended

Coming Foreclosure “Wave” Will be Different From 2008

If you own your home and have been struggling to make payments as a result of the coronavirus pandemic, you might have received some relief through the CARES Act or through other forbearance options for mortgages held by private lenders. Yet forbearance options are running out for many homeowners, and many more remain without work and the ability to make mortgage payments. As such, many homeowners could be at risk of foreclosure.

Based on the high rate of unemployment as a result of coronavirus shutdowns and the inability for many of those out-of-work homeowners to find meaningful employment, economic experts have predicted that we are likely to see a rise in foreclosure rates akin to that during the housing crisis and real estate burst that began in late 2007 and went into full force by 2008. By 2010, the foreclosure crisis largely had reached its peak—should we expect something similar a decade later?

Housing Analysts Say We Should Not Expect a Repeat of the Foreclosure Crisis

According to a recent article in DSNews.com, “industry professionals predict conditions won’t be nearly as bad as they were in 2008-2010” for a handful of specific reasons. We want to discuss some of those reasons with you. At the same time, we want to emphasize that foreclosure risks are real, and to underscore that you may have options to avoid foreclosure.

From loan modifications to Chapter 13 bankruptcy, an experienced foreclosure defense attorney in Oak Park can discuss the ways in which you may be able to prevent a foreclosure. However, it is important to seek help on the sooner side. If you wait too long, it may be more difficult or even impossible for you to keep your home.

Expectations for Forecloses and Losses Look “Mild” Compared to 2008-2010

Believe it or not, housing analysts say that the losses the federal government is expecting as a result of the coronavirus pandemic appear “mild compared to those in the Great Recession.” Specifically, the federal government is anticipating that Fannie Mae and Freddie Mac will experience “several billion dollars in loan losses.” Yet to put those numbers in perspective, those numbers are not “anywhere near the catastrophe” that occurred during the Great Recession.

One of the major reasons is that, prior to the coronavirus pandemic, there was not the same “frenzy of foolish lending, reckless borrowing, and rampant speculation [that] set the housing market up for a wrenching crash” more than a decade ago. Indeed, just before the pandemic led to the economic downturn, “credit standards remained tight, and the housing market was healthy.”

In addition, homeowners now have larger reserves of home equity, and the government “reacted relatively quickly and aggressively to the COVID recession,” according to the article.

Seek Advice From an Oak Park Foreclosure Defense Attorney

Are you struggling to make mortgage payments? Are you out of work as a result of the coronavirus pandemic? Do you have concerns about foreclosure and losing your home? You may have options to avoid foreclosure by discussing your options with one of the dedicated Oak Park foreclosure defense attorneys at our firm. Contact the Emerson Law Firm to learn more about how we can help you to keep your home when foreclosure is looming.


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Foreclosure Surge: Question is Not When, But How Much?
Long-Term Effects of Foreclosure

Will Foreclosure Rates Soon Exceed Those of the 2008 Financial Crisis?

If you are struggling to make your mortgage payment in Oak Park or elsewhere in the greater Chicago metropolitan area, you should know that you are not alone. While recognizing that thousands of other families in the U.S. are struggling with the risk of foreclosure during the economic downturn caused by the coronavirus pandemic will not pay your bills, it can be helpful to understand that consumer advocates understand this dangerous trend.

According to a recent article in HousingWire, some experts are predicting an oncoming wave of COVID-19 foreclosures that will surpass those of the Great Recession more than 10 years ago. At the same time, homeowners do have advantages and protections that they did not have previously. We want to say more about the recent article, and about some of the ways that homeowners affected by the coronavirus pandemic may be able to avoid foreclosure.

Healthcare Crisis Foreclosures Could Surpass 2008 Levels
It was not very long ago that the housing market crash of 2008 resulted in millions of home foreclosures. Between 2006 and 2016, experts estimate that about 10 million homes went through the foreclosure process. While that “freefall of the housing market nearly took down the entire U.S. economy” in a way that perhaps seemed like a once-in-a-lifetime occurrence, now the COVID-19 emergency is more than threatening to do the same. The reality is that millions of Americans have lost their jobs and cannot find new ones due to the pandemic and business closures. A wide variety of industries are experiencing effects of the coronavirus pandemic and the economic downturn, from blue-collar and manual labor jobs to white-collar professions. Currently more than 22 million people have filed for unemployment benefits, and HousingWire predicts that 15 million more will occur by its next report.

Currently, about 3 million mortgages nationwide are in forbearance due to the pandemic and job loss. Just as homeowners are unable to make their monthly mortgage payments, millions more could seek forbearances and alternatives to foreclosure in the coming weeks and months. These actions are taking place when lenders are restricting the kinds of loans they are offering and, in some cases, even the lenders are going out of business. All of these facts are leading experts to worry that we could ultimately see rates of home foreclosure that surpass those of the 2008 financial crisis.

Positive Numbers and Foreclosure Avoidance
Although tens of millions of Americans are without a job, there are some protections that did not exist during the 2008 foreclosure crisis. First, disaster relief money and more eligibility for unemployment claims has resulted in some people being able to make ends meet for the time being. In addition, a number of forbearance programs are currently in existence, allowing homeowners to delay making a mortgage payment for up to 12 months if they are experiencing a COVID-related hardship.

If you may be at risk of foreclosure, you should learn about forbearance options and discuss other potential measures with an Oak Park foreclosure defense lawyer.

Contact a Foreclosure Defense Attorney in Oak Park
If you are struggling to make your mortgage payment and are at risk of foreclosure, an experienced and compassionate Oak Park foreclosure defense lawyer can discuss your options with you. Contact the Emerson Law Firm for more information.



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FHFA Report on Foreclosure Prevention

Are foreclosure prevention methods working? According to a recent article in DSNews.com, 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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How to Slow Down the Foreclosure Process

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

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

Illinois Homeowners are Avoiding Foreclosure

Remedy for Illinois Homeowners Who Faced Foreclosure

Did your home go into foreclosure, or were you facing the threat of foreclosure, while dealing with the mortgage servicer PHH Mortgage Corp.? You may be eligible for a financial remedy. According to a recent article in the Chicago Tribune, Illinois Attorney General Lisa Madigan reported that “Illinois residents who faced foreclosure or lost their homes due to alleged improper mortgage loan serving practices by PHH Mortgage Corp. are eligible to collect $1.5 million in cash payments as part of a nationwide settlement.” The company was sued by the attorneys general of every U.S. state except New Jersey, in addition to facing lawsuits from mortgage regulators. What else do you need to know about the settlement and its connection to the foreclosure crisis?

Alleged Improper Mortgage Servicing Practices By PHH Mortgage Corp.

What are the alleged improper mortgage servicing practices by PHH Mortgage Corp. that resulted in the recent settlement? According to the article, the company:

• Failed to properly apply homeowners’ loan payments;
• Failed to properly execute paperwork for foreclosures; and
• Failed to respond to borrowers’ requests for loan information.

As a result of these improper mortgage servicing practices, Attorney General Madigan and other attorneys general throughout the country contended that homeowners dealt with the uncertainty of foreclosure, and many actually lost their homes due to foreclosure. According to Madigan, “this settlement will provide some long-awaited relief to the homeowners who fell victim to PHH’s improper loan services practices.” Madigan went on to explain how, “under this agreement, PHH will be held accountable for its actions and must follow standards to prevent this conduct in the future.”

What kinds of remedies are available to homeowners under the terms of the settlement? If you lost your home through foreclosure and your mortgage was serviced by PHH Mortgage Corp., you may be eligible for a payment of at least $840. If you did not lose your home, but PHH initiated foreclosure proceedings, you may be eligible to receive a payment of at least $285. The alleged improper mortgage servicing practices occurred between 2009 and 2012, just as many Oak Park residents were still struggling to recover from the housing crisis. Upwards of 2,800 homeowners in Illinois could be eligible to receive a payment from the settlement.

Mortgage Servicing Rules from the CFPB

The Consumer Financial Protection Bureau (CFPB) issued a final Mortgage Servicing Rule in 2016, and it clarifies the obligations of mortgage servicers. Common complaints about mortgage servicers include but are not limited to the following:

• Failing to apply mortgage payments in a timely manner;
• Improperly applying mortgage payments;
• Failing to apply mortgage payments altogether;
• Charging egregious fees to homeowners;
• Dual-tracking (which involves the mortgage servicer working with a homeowner on a loan modification while moving forward with foreclosure proceedings); and
• Failing to provide information to consumers about their mortgages or the state of foreclosure proceedings.

When mortgage servicers harm consumers, they can be held responsible.

Seek Advice from an Oak Park Foreclosure Defense Attorney

Homeowners should not have to face foreclosure as a result of improper mortgage services practices. If you were harmed by a mortgage servicer’s practices, or if you have questions about the PHH Mortgage Corp. settlement, an Oak Park foreclosure defense lawyer can help. Contact the Emerson Law Firm to discuss your case.

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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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