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Foreclosure In The
State Of Illinois
Foreclosure of a Mortgage is a four-step process
in the state of Illinois.
First the lender must sue the defaulting property owner (usually 3-4
months following the first missed payments, although sometimes earlier)
and give legal notice of that suit (call Les Pendent).
The second phase is when the lender obtains a judgment for the amount
due. Depending on how efficient the attorneys handling the foreclosure
are, this step can take place anywhere between 4 and 6 months following
the initial filing. Bankruptcy and negotiations for deals can sometimes
also delay this step. During these critical first steps is the ideal
time for you to negotiate a favorable deal, or consider other services.
For example, realtors could offer to list the property; attorneys could
explore bankruptcy options; lenders could offer financing packages;
investor could offer to purchase the property; or you can consider a
short-sale option.
The Third stage of foreclosure in Illinois occurs after the redemption
time for the homeowner has expired the (later of either) 7 months
following the day the defendant is served or 3 months following the Day
of Judgment. This is the foreclosure sale, or the Sheriff’s sale.
Commercial property owners have only 6 months following service or 3
months following the judgment to redeem. Of course, bankruptcy and other
workout plans can delay the process.
Properties are auctioned beginning with the opening bid submitted by the
foreclosing lender. In Illinois, investors at the sale are required to
put 10% down at the time of sale and the balance within 24 hours. This
means that, in our state, investors must have CASH to take advantage of
the deals on auction day. This is different from most other states and
makes for a very high percentage rate of R.E.O. (Real Estate Owned)
properties. If there are no successful bidders at the auction, the
property is awarded t the plaintiff and becomes an R.E.O. property. This
is the most common fate for a property that actually hits the auction
block. Investors can then try to deal directly with lenders after the
foreclosure sale to purchase R.E.O. at discounted prices.
Illinois process is long compared to most other states. Only a few other
states have their entire redemption period to the foreclosure sale. It
sis for this reason and because bidding requires cash that many deals
are made at the pre-foreclosure stage in our state.
Illinois Foreclosure
Law |
