Illinois Secures Part of $25 Billion National Bank Foreclosure Settlement

The Illinois attorney general, Ms. Lisa Madigan, in conjunction with the Department of Housing & Urban Development, the U.S. Department of Justice and other state attorneys general procured a national settlement agreement with the largest banks in the nation providing $25 billion in aid for homeowners affected by fraudulent mortgage and foreclosure practices. The settlement is the second largest in history obtain through collaborated efforts of state attorneys general, and occurred after months of negotiations and investigations into the questionable lending practices utilized by banks during the real estate boom.

In addition to providing financial assistance to eligible homeowners, the national settlement also established stringent new rules governing lending servicing standards that are aimed at thwarting abusive practices by lenders in the foreclosure process and complicated procedures homeowners had difficulty navigating when seeking a loan modification.

Relief for Illinois Communities

Attorney general Madigan set aside $70 million in funds from the national settlement to provide housing-related counseling services in addition to community relief efforts for areas most affected by foreclosure burdened with dilapidated neighborhoods filled with vacant and abandoned homes. The funding allocations were determined by a coalition, known as the Attorney General’s Blue Ribbon Advisory Council, of housing and community development experts from state not-for-profits, private and government sectors. Awards were distributed based on housing data relating to foreclosure and vacant homes.

If you or someone you know is facing foreclosure, taking no action to attempt to save the home may not be the best option. Homeowners facing foreclosure have a limited amount of time to assert rights and actions that may help in keeping the property. There are proactive steps that can be taken when dealing with the stress and personal crisis of losing a home. Some actions that should be taken in these circumstances include:

- Seeking legal help: the emotions involved with the possible loss of a home can cloud an otherwise logical mind, and it is in your best interests to find an experienced foreclosure attorney to guide you through this difficult time.

- Communicating: contact the mortgage lender and explain the circumstances that led up to falling behind on payments and ask what steps can be taken to bring the loan up to date.

- Weighing the options: alternatives to foreclosure are available and include short sales, deed in lieu of foreclosure and loan modification.

- Protecting the value of the property: it is possible that significant equity exists in the home being foreclosed on and, as such, it is in the homeowner’s best interest to protect this wealth.

Legal Help is Available

If you are facing foreclosure of your home, contact an Illinois foreclosure attorney today to learn about your rights and obligations. Don’t navigate this complex process alone. An experienced attorney can help pursue alternatives to foreclosure and help to save your home. With over 35 years of experience fighting for clients’ rights, the Law Offices of Gilbert C. Schumm can provide real estate advice and serves the Chicago area including Arlington Heights, Rolling Meadows, Des Plaines, and Streamwood. 

Insights from a Schaumburg Forecloure Lawyer

Foreclosure Help for Residents of Schaumburg, Illinois and Surrounding Areas

Although foreclosure rates are falling nationally, the foreclosure rate in Illinois remains one of the highest in the country. If you are one of the thousands of Illinois residents who owe more than your house is worth, several legal and non-legal options are available to help you.

Recent Cook County and DuPage County Foreclosure Rates

According to April, 2014 data, Illinois’ foreclosure rate was the sixth highest in the United States. In Schaumburg alone, there are currently 1,013 properties in some stage of foreclosure (default, auction or bank owned) and the number of properties that received a foreclosure filing was 34 percent higher than the previous month.

March home sales data showed that Schaumburg home sales were also down 8 percent from the previous month. The median sales price of a foreclosure home was $147,500, which was 13 percent lower than the average for non-distressed home sales.

Options For Homeowners Who Cannot Make Their Mortgage Payments

Being unable to make your mortgage payments is a scary feeling. Even if you have previously tried to modify your home loan, new “Making Home Affordable” (MHA) programs jointly implemented through the Department of the Treasury and the Department of Housing and Urban Development make it worth your while to try again. These programs include:

If you are employed but still struggling—there are a couple of programs that may be of help, including:

• Home Affordable Modification Program (HAMP). HAMP may lower your monthly mortgage payments in order to make them more affordable long-term. To be eligible for HAMP, you must meet certain requirements, including: (1) you obtained your mortgage on or before January 1, 2009; (2) you owe up to $729,750 on your primary residence (other values for rental property); (3) the property has not been condemned; (4) you have a financial hardship; (5) you are delinquent or in danger of falling behind on your mortgage; (6) you have sufficient, documented income to support a modification payment; and (7) in the past 10 years, you have not been convicted of a felony, larceny, theft, fraud or forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.

• Home Affordable Refinance Program (HARP). HARP may allow you to refinance and get a lower interest rate if you are unable to get traditional refinancing because the value of your home has declined. The program requires a loan application, and underwriting and refinance fees will apply. HARP eligibility requirements include: (1) your mortgage must be owned or guaranteed by Fannie Mae or Freddie Mac; (2) your mortgage cannot have been previously refinanced under HARP unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009; (3) the current loan-to-value (LTV) ratio must be greater than 80 percent; and (4) you must be current on your mortgage at the time of refinance, with a good payment history in the past 12 months.

If you are unemployed:

• MHA’s Home Affordable Unemployment Program (UP) may reduce mortgage payments up to 31 percent of your income or even suspend payments altogether for 12 months or more if: (1) you are unemployed and eligible for unemployment benefits; (2) you occupy your house as your primary residence; (3) you have not previously received a HAMP modification; (4) you obtained your mortgage on or before January 1, 2009; and you owe up to $729,750 on your home.
  

Getting Legal Help If You Are Being Faced With Foreclosure In Illinois

If loan modification is not a possibility for you, legal help may be available to prevent or stop a foreclosure on your home. Last year, the Illinois Supreme Court announced new rules governing mortgage foreclosures. These new rules require lenders to prove to judges that they have exhausted all efforts to help you keep your home prior to seeking a foreclosure judgment against you.

Foreclosure actions can be complicated to defend for individuals, partly because of the rules and because you are facing off against experienced lawyers and lenders who have been through this process hundreds of times. If you are facing a foreclosure action, you should strongly consider getting legal representation.

The Law Offices of Gilbert C. Schumm has more than 35 years of experience representing the rights of clients in Schaumburg, Illinois and the surrounding areas, including Elk Grove Village, Palatine, Chicago and Arlington Heights. If you are in Cook, DuPage or Will County, please call (847) 559-9109.