Foreclosure Law in Illinois
In Mchenry, Illinois, foreclosure is a legal process through which an entity which has issued a mortgage takes possession and/or ownership of the property that secured the mortgage, because the individual who took out the mortgage has consistently failed to make payments on it. The property in question is usually a house.
If an ordinary consumer faces foreclosure, it typically involves a home that was purchased with a mortgage from a bank. The bank will typically try to sell the house at a public option, with the hope of at least covering the remaining debt, to avoid taking a large loss.
In all states in the U.S., including Illinois, borrowers have the option of foreclosure by judicial sale. This permits a court to oversee the sale of the property by the bank. The purpose of this is to get the house to sell for the highest price possible. While this might seem like something that would only benefit the bank, it is also a great benefit to the borrower, since it increases the likelihood that the sale will encompass the full balance of the mortgage, preventing them from having to pay it.
In many states, mortgages fall into a category of loans identified as "non-recourse loans." This means that, if the house is sold by the lender, the entire debt is eliminated, even if the sale price was less than the remaining balance on the loan. While the loss of one's home can be personally devastating, treating a mortgage as a non-recourse loan at least means that the homeowner will be more or less free to move on with their life once the property is foreclosed and sold.
How to Possibly Avoid Foreclosure in Mchenry, Illinois
First and foremost, you need to communicate with your lender, and not dismiss the issue. Ignoring a problem with your mortgage will not make it go away, and can only make things worse. You should be forthright with your lender, and stay in touch with them as much as possible.
You must keep in mind that banks are in the business of lending funds, not flipping property: the bank doesn't really want your house. To that end, they'll occasionally go to great lengths to accommodate your financial situation, whatever it may be. For banks, foreclosure is a last resort.
If you experience a sudden change in your financial situation, your lender, in an effort to keep you from defaulting, might be willing to accept lower monthly payments, at least temporarily.
In Illinois, some buyers have no choice but to resort to a short sale. This is simply the sale of the house, and using the funds to pay off the remainder of the mortgage. One benefit of a short sale is that, if the house sells for less than the mortgage balance, the remaining debt is excused, and the borrower is free and clear.
Can a Mchenry, Illinois real estate attorney help?
If you feel that your home is close to being foreclosed in Mchenry, Illinois, and want to try to prevent this, the advice and assistance of an efficient real estate lawyer can mean the difference between keeping or losing your home.