How To Stop Foreclosure In Illinois
Facing foreclosure is stressful, legally complex, and a danger to your credit. If you have missed mortgage payments or your lender has filed a Notice of Default (NOD), you might feel like there is nothing you can do to prevent the loss of your home. But you are not without hope. In Illinois, there are legal avenues an experienced foreclosure lawyer can use to help you save your home. Negotiating with the lender, using government relief avenues, and taking the lender to court are just some of the methods the lawyer can use to help you. If you have received or expect to receive a foreclosure notice, you should immediately contact an attorney. Let’s look at just a few ways an attorney can help you save your home and protect your credit. Negotiate with the Lender to Resume Payments If you can pay the money you owe to the lender due to missed mortgage payments, now or shortly, you may be able to save your home. Your mortgage is a loan. A bank is usually the lender of the mortgage. Foreclosure is the lender’s process for taking a homeowner’s property because the homeowner failed to make agreed-upon payments to pay back their loan. The lender forecloses to take the property and sell it. The sale of the foreclosed property is the typical way the lender gets its money back. But suppose you can demonstrate your ability to pay the lender the money you owe and stay current with future payments. In this case, your lawyer may be able to negotiate with the lender to stop your foreclosure. There are a couple of ways to do this. Pay the Amount Past Due in Full Now Your attorney can call your lender and determine precisely how much you owe the lender. If you can pay that full amount, the attorney will contact your lender immediately. They will make an offer for you to pay the full amount in arrears (the payment amount you are behind) and your next mortgage payment due in a timely manner. In return, they will ask that the lender end the foreclosure process. For instance, if the amount in arrears is $3,000 on a mortgage payment of $1,000 per month, you must be able to fully pay the lender $4,000 (the $3,000 past due and the next due mortgage payment of $1,000) immediately. It would be best if you considered the impact this may have on other bills before your lawyer makes this offer to the lender. Also, be sure that you are prepared to continue and pay the standard monthly mortgage from now on. Get on a Payment Plan Another option is to catch up on the arrears over time. Your lawyer can work with you to determine what amount you can pay beyond your standard mortgage amount. They can then negotiate with the bank for you to pay this additional amount until you catch up on your past due amount. Let’s say you are behind $1,600 on a mortgage of $800 a month. You advise your attorney that you are now in a position to pay your full monthly mortgage of $800 a month, plus another $400 each month. The lawyer could negotiate a $1,200-a-month payment for four months. Under this agreement, you will be caught up on your mortgage at the end of four months and no longer at risk of foreclosure. If you are in a position to pay off your arrears and continue making your current payments, you could be able to avoid foreclosure. Remember, the lender wants their money. Hiring an attorney who can show the lender a reasonable way to receive the money they are due is usually the fastest and easiest way to stop a foreclosure. Request A Loan Modification If you have had an unexpected change in financial circumstances, a loan modification may be your best option. In this situation, your attorney will contact the lender and explain your circumstances and how they impacted your ability to make timely mortgage payments. Standard hardships lenders may consider, which often affect homeownership and finances, include: A recently contested divorce proceeding; An accident that caused significant injury or disability; Income decline due to an unexpected job loss; A salary reduction at a long-term current job or new job; Being the victim of fraud or another financial crime; A national crisis, such as a pandemic; Child support and custody issues; or A sudden death in the family. Lawyers will gather facts and proof of the incident(s) that relate to your financial change. They will then ask the lender for your loan to be modified (lower payment for a time, refinance to a longer mortgage term, or another option that will reduce your payments). They may also ask the lender to forgive the past due amount or add it on to the end of the mortgage. With either approach, you will need to show that you now have a source of income and can make the agreed-upon new payments. A lender’s automated email and phone banks do not analyze or recognize hardships. However, specific workers for the companies can do so, especially if you have had a strong payment history up until this time. Your attorney will know to whom and how to make the case for a hardship loan modification. Seek Special Relief: CARES Act And COVID-19 Your local, state, or federal government may issue a mandate that will protect you from foreclosure in rare circumstances. Times of a nationwide recession, health crisis, or natural disaster may initiate laws to help homeowners. The relief may come in the form of: Forgiveness of missed payments; Forbearance (suspension) of payments; or A ban on foreclosures for a period of time. During the pandemic’s national health crisis (COVID-19), the United States government created the Coronavirus Aid, Relief and Economic Security (CARES) Act. One purpose of the act was to help homeowners keep their homes during the pandemic’s health and financial crisis. The CARES Act: Gave a...
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