If you are behind on your mortgage payments, the lender will most likely require that you start making payments before the loan’s canceled. If you are in default, your credit score will be affected and may hurt your ability to get a new loan in the future. That way, you can avoid foreclosure in Chicago, you need to act quickly and take the steps below.

Keep in mind that not all the steps below will apply to you. The key is finding the steps you can use to avoid foreclosure on your property.

5 Steps to Avoid Foreclosure in Chicago

1. Explore your options

To avoid foreclosure, you need to explore your options. Examples of steps you can take include handing over the property to the lender in a deed in lieu of foreclosure, working with the lender on a repayment plan, refinancing your property, or selling your property.

The great thing about the state of Illinois, the average foreclosure takes around 2-years from the first missed payment to the eviction, (see legal rights below) which gives you time to determine what option works best for your needs.

2. Don’t ignore the problem

Yes, you have time to avoid foreclosure. Therefore, do not waste it. One of the worst things you can do when you receive a foreclosure notice is to ignore the notice. While ignoring the notice might seem like a good way to hold on to your sanity in the short term, you hurt yourself by not having the time to make an intelligent decision.

Foreclosure is a complicated, time-consuming process that includes moving deadlines. To prevent foreclosure evictions which involve the sheriff’s office arriving at your house to evict you from the property, you need to pay attention to the notice of lis pendis and all other documents leading up to the foreclosure eviction.

We constantly receive calls from desperate homeowners about to lose their house in the next 30 days or less. While we help as many as we can, depending on the timing it is not always possible. We need time to do our due diligence and also to correctly transfer the title. That is why procrastination is so dangerous to those in foreclosure. What you think is a lot of time sneaks up on you with tight deadlines.

3. Set-up a Payment Arrangement

Call the lender as soon as you think you might be late or miss a payment to ask for a payment arrangement. The lender may offer to work out a payment plan with you with the intention of avoiding foreclosure and the adverse effects that a foreclosure will have on your credit score. Lenders don’t benefit from you going into foreclosure. Every foreclosure property they own means they need to hold onto more assets that they cannot lend the following year. This reserve amount is dictated by Fannie and Freddie Mae.

That said, do not stop making your monthly mortgage payments unless absolutely necessary. Continue to make payments as scheduled on time until the lender accepts your request for a payment plan.

If you miss a payment, the lender may require you to pay the missed payments before accepting a payment plan. Each lender is different, so please check with them before making a decision.

If you cannot reach a payment plan with your lender, the lender will take legal action to foreclose on your home if you are more than 120 days late on the payment. The lender files a lawsuit to take ownership of your home.

4. Foreclosure process in Illinois

For example, in the event the lender files a lawsuit to take ownership of your home, the borrower must be served notice in the state of Illinois along with a notice of their rights in addition to a copy of the complaint and summons. The borrower then has 30 days to respond to the judgment. If they don’t respond, the judge presents a default judgment in favor of the lender.

After this, you have a redemption period before the sale of your home occurs. The redemption period is 3 months from the judgment date or 7 months after the initial complaint was served, whichever is longer.

Finally, the lender sends a notification 10 days before the house will be sold. Additionally, the lender must publish the sale for at least 3 consecutive weeks in a local paper.

The sale date marks a 30-day period before the owner needs to vacate the property. Please note these dates do change and you should confirm with a licensed attorney. Note: this is not legal advice.

5. Sell Your home

This is a tough thing to do, especially if you are a homeowner. However, if you are not able to financially hold onto the house, selling the home could be your best option.

For example, let’s say your mortgage was more than the cost of your home. In this case, financially you would be paying for a home that might take years to catch up in value. However, a short sale allows you to talk to the bank about getting out from your upside-down home and how to remove the negative debt from your credit record.

Furthermore, it ensures you do not have a foreclosure eviction on your record showing that you needed to be removed by Cook County. It is time to sell your home before that happens. If you are interested in a no-obligation quote, learn more about how you can sell your home today.

foreclosure in chicago infographic

Final Thoughts on Avoiding Foreclosure in Chicago

A foreclosure is a horrible event in your life. However, there are ways out. Whether you choose a forbearance agreement, legal approach, or sell your home, it is important that you consider your options and take some or all of the steps above to ensure you can move on with your life after this happens.

If you have any questions about how to move forward, please contact us today at 847-710-7093.