New Illinois Supreme Court Rules Take Effect to Safeguard against Foreclosure Abuse
Lawmakers nationwide are taking steps to stop foreclosure abuse. During the height of the housing market crash and subsequent foreclosure crisis, millions of homeowners -including those in Chicago - became victims of fraudulent foreclosures and mortgage servicing practices. Lenders sometimes engaged in “robo-signing”, where they falsified documents to accelerate the foreclosure process. Such lender abuses coupled with the inherent uncertainty of the foreclosure process provided the perfect avenue for homeowners to lose their homes.
As a judicial foreclosure state, lenders in Illinois must follow certain procedures before they can take possession of your home. Recently, and in light of the recent “robo-signing” controversy settlement, the Supreme Court of Illinois adopted three new rules to mitigate the abuse that homeowners often suffer during the foreclosure process.
Foreclosure Mediation Program (Rule 99.1)
The Foreclosure Mediation Program is designed to assist both the lender and homeowner by offering the homeowner ways to avoid foreclosure. Circuit courts with existing mediation requirements (including Cook County) had to make changes to their programs to comply with the new rules.
Notice Requirements (Rule 113)
To comply with Rule 113 Notice Requirements, the lender must provide the following documents to the borrower prior to foreclosure:
- Original promissory note, which must contain the borrower's signature—this rule addresses the issue of lenders selling off mortgages and not maintaining proper records
- Prove-up affidavit, to support the amount the borrower owes and the amounts due when seeking a judgment—a standardized court form is available which meets the minimum requirements
- Notice of default judgment, a letter sent by the clerk to the homeowner explaining what took place in court (in cases where the borrower failed to appear in court)—under the new rules, within two days of the judgment the lender's attorney must prepare the notice for the clerk, and must include an address where the homeowner will most likely receive it
- Notice of sale, which is sent to the homeowner and any other defendants 10 days prior of the date, time and place of the intended sale of the property—newspaper advertisements are no longer sufficient
Loss Mitigation Affidavit (Rule 114)
In their Loss Mitigation Affidavits, lenders certify that they took steps to prevent foreclosure by offering programs or mortgage workouts to homeowners who filed documents or appeared in court.
A foreclosure defense attorney can ensure that your mortgage lender is complying with these rules.
The implementation of these additional requirements during the foreclosure process provides homeowners a fair foreclosure process and adequate assistance. If you are facing foreclosure, get the help you need to stop foreclosure by contacting the DebtStoppers, Bankruptcy Law Firm.