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Lake County foreclosure defense attorneysBuying a home can be a dream come true for many people. Even if you worked hard and saved a substantial amount for a down payment, you will likely still need to take out a loan, which is known as a mortgage. If you fail to make your monthly mortgage payments, you could be at risk of losing your house. Foreclosure is the legal process by which the lender or bank can repossess your house. This means you will have to vacate the premises within a certain amount of time.

If your house is worth less than the amount you owe on your loan, a deficiency judgment may be entered. Not only do you lose your home, but you may owe your lender additional money to make up the difference in value, and your credit score will go down. The global coronavirus pandemic has impacted many homeowners financially. Fortunately, there are ways you can avoid going through foreclosure.

Practical Steps to Keep Your House

There is no doubt that the COVID-19 pandemic has impacted our nation’s economy. Many businesses have closed their doors, leaving workers unemployed and without their usual incomes. This has led many homeowners to fall behind on their bills, including their mortgage payments, which are often their biggest expense. While most lenders have instituted a moratorium on foreclosure proceedings during the current health crisis, the moratorium will eventually be lifted. It is a good idea to start preparing now for that reality.

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Lake County foreclosure defense lawyersForeclosure is the legal process during which a home is sold to settle an unpaid mortgage debt. When a homeowner falls behind on his or her mortgage payments, the home may go into foreclosure, and the mortgage lender may seize the property. In Illinois, all foreclosures are “judicial” which means that the process is carried out through the court system. In other states, non-judicial foreclosures may be an option, but Illinois law only permits judicial foreclosures. The legal process of foreclosing on a home can take several months to several years in Illinois. If you are concerned that your home may go into foreclosure, talk to an experienced foreclosure attorney so that you can explore potential defenses.

When Does a Mortgage Servicer Initiate a Foreclosure?

Life can be unpredictable to say the least. When an unexpected illness, disability, job loss, or other financial hardship occurs, a homeowner may fall behind on his or her mortgage payments. A mortgage servicer cannot initiate foreclosure procedures simply because a borrower has missed one or two payments. However, when a borrower is over 120 days delinquent on their mortgage loan payments, the servicer may begin the foreclosure. A homeowner who has not been making payments will receive a “breach letter” that notifies him or her that he or she is in default on the mortgage loan. At this point, the homeowner should speak to a lawyer and start exploring alternatives to foreclosure such as a loan modification or short sale. If nothing is done to remedy the default, the servicer will officially begin foreclosure proceedings

Judicial Foreclosure Filing

In order for a mortgage servicer to be permitted to resell a home, the servicer must file a foreclosure lawsuit in court. Typically, a lender will file the petition for foreclosure documents in the circuit court of the Illinois county in which the property is located. However, the servicer also has the option to file the petition for foreclosure in federal court. Once the mortgage servicer files the foreclosure with the court, you will be personally served with a copy of the servicer’s complaint and a summons. You will be asked to file a response that notifies the court of whether or not you intend to object to the foreclosure. If you do not file a response within 30 days, a default judgment could be entered against you. This means that you automatically lose the case and the mortgage servicer is authorized to proceed with the sale of your home. This is why it is so crucial for anyone facing foreclosure to contact a quality attorney as soon as possible.

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Lake County foreclosure defense attorneysFor most people, it is not very hard to imagine a scenario in which they cannot afford to pay all of their bills. Maybe it starts with a missed auto loan payment or a monthly credit card payment, but all too quickly, a person is so far behind that it catching everything up might be impossible—especially catching everything up at the same time. In many cases like this, the person’s best option may be to file for Chapter 13 bankruptcy.

If your mortgage is one of the obligations on which you have fallen behind, you probably realize that your lender may soon have the right to foreclose on your home. In fact, depending on the circumstances, you might have already received notice that foreclosure proceedings have begun. Once foreclosure proceedings begin, you might be inclined to simply stop paying your mortgage, but if you have filed Chapter 13 bankruptcy, doing so could cause you more problems than it solves—especially if you hope to keep your home.

Automatic Stay in Bankruptcy

When you file for protection under Chapter 13 of the United States Bankruptcy Code, the court will automatically issue a stay on all debt collection activities—including efforts by your lender to collect your delinquent payments. The automatic stay also stops foreclosure proceedings. Your lender, however, can request permission from the court to continue the foreclosure. The court has the discretion to grant the lender’s request, but certain circumstances will make the court more likely to approve allowing the foreclosure to continue.

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