-Â Judicial Foreclosure Available: Yes
-Â Non-Judicial Foreclosure Available: No
-Â Primary Security Instrument: Mortgage
-Â Timeline: Typically 210 days
-Â Right of Redemption: No
-Â Deficiency Judgments Allowed: Yes
Lenders in Illinois have a number of options available to them to foreclose on a mortgage in default.
Judicial Foreclosure
A notice of the lenders intent to foreclose must be given to the borrower, and any other person entitled by Illinois statutes to receive notice, at least thirty (30) days prior to the courts judgment of foreclosure.
If the court finds in favor of the lender and issues a notice of sale, the sale will be conducted on the terms and conditions specified in the notice of sale, provided they meet the minimum standards provided in the Illinois Statutes.
The sheriff or any judge within the county where the property is located may conduct the sale. The borrower has no rights of redemption after the foreclosure sale.
Deed in Lieu of Foreclosure
If the borrower has defaulted on the mortgage and the lender agrees, the borrower may simply give the deed to the lender and his interests in the property securing the deed will be terminated. If the lender agrees and accepts the deed, they may not seek to obtain a deficiency judgment against the borrower at any time afterward.
Consent Foreclosure
In this type of foreclosure, the court enters a judgment satisfying the mortgage by giving absolute title to the property secured by the mortgage to the lender. The borrower has no rights of redemption after this type of foreclosure judgment has been rendered and the lender may not file for a deficiency judgment.
Lenders may also foreclose on a mortgage in default by using the common law strict foreclosure method, but Illinois law does not permit non-judicial power of sale foreclosures.
I own a home in Illinois that I do not live in. I had to move two years ago for a job relocation, and could not sell it for anything close to what I owe on it. I was able to rent it out at a $1000 mo. loss, beter than $3000 mo. with out renters. If the only consequence was a credit hit I would be willing to go into foreclosure. I can afford my mortgage in Wisconsin (where I live) and the rental loss, but I will fall quickly behind without renters. The mortgage lender has be totally unhelpful, and will not rework the loan due to negative equity in it. I do not qualify for any goverment programs due to my income. What are my options here? Can I strategic default with only a credit hit, or are they going to be chasing me down for years on this? Is there a way to get the lender to work with me? I would be willing to rent longer if there was not such a loss, it is affecting my marrige and my families standard of living. I have talked to two local lawyers and have only $500 in legal fees to show for it, and no real solutions, am I talking to the wrong lawyers?
Thank You
Hi Bill,
You need to find out if Wisconsin is a recourse state. That means that the lender can come after you for the deficiency in the loan.
As for the lawyer, I would find a good real estate lawyer in your area. You may have to go to a larger city to find one that specializes in short sales, loan modification, and distressed real estate law. You have to remember though, unless the attorney can find something in the paperwork that the bank did wrong (negligent), there really is not defense in a foreclosure case except to pay your mortgage. An experience attorney should be able to walk you through any loan modifications or workouts with the bank. If you are going to do a short sale, we highly recommend working with an investor in your area that KNOWS how to do short sales. We find that there is no motivation to get it done like making money, and the investor usually does the best job.
Keep reading this site and you will know exactly what to ask an investor before you choose them to do your short sale!