If you’re facing the possibility of a foreclosure in Illinois, you may have some pressing questions. Chief among them may be questions along the lines of:
- “How long does the foreclosure process take?”
- “What are the steps of the foreclosure process in Illinois?”
- “Is there a way to avoid foreclosure once proceedings have begun?”
- “Where can I turn for help?”
Let’s talk through the many steps involved in an Illinois foreclosure, highlighting how the timeline may work – and your responsibilities, options, and legal rights at each stage of the way.
1.) Missing Payments
Let’s start at the beginning – with a first missed payment. Generally speaking, many loans have a built-in grace period for late payments, often around 10 or 15 days After this period, and several notices, a loan servicer will typically assess a late fee. (Information on late fees and grace periods will be included in your promissory note, or may be available on your regular mortgage statement.)
After several missed payments, your loan servicer will continue to follow up with notices, including calls, attempting collection of late payments.
At this time, your loan company may also contact you with information about mitigation options, payment plans, loan modification, forbearance plans, and so on. Under federal laws, mortgage servicers must give homeowners a reasonable grace period before filing in state court to commence the foreclosure.
2.) Breach Letter/Acceleration
At a certain point, your mortgage servicer is likely to send a breach letter, also called a demand letter or notice of acceleration, to inform you that you are going to default (unless you take action), and that the entire amount of the loan is going to be due and payable immediately. This notice must include the default, the actions you can take to cure the default, a date that the default must be cured by, and a warning that failing to address the default will result in acceleration.
Around the same time, you will likely receive a Grace Period Notice; required by law, this notice provides information about housing counseling available to you, and prevents the lender from taking action towards a foreclosure, typically for 30 days (and generally an additional 30 days beyond that, if you accept counseling).
3.) The Lender Files a Foreclosure Suit
In Illinois, the lender must take action as a plaintiff, and file a lawsuit with the state court. The process begins when the lender files a complaint, typically naming everyone with an interest in the property.
After this, you, the homeowner, are served the complaint, and given a summons that typically provides 30 days to file a response. At the same time, homeowners are typically given a notice informing them of their rights during the foreclosure process.
If you fail to respond your summons, it is possible that the lender may obtain a default judgment from the court – meaning that you lose the case. If you do respond in time, either providing a satisfactory response or requesting an extension, things either end up going to trial, or the lender files for a summary judgment (a motion requesting that the court grant in their favor).
Whether your lender pursues a summary judgment or things go to trial, the timeline here is generally a matter of weeks or months. A typical process may look something like:
- You file your answer
- The lender moves for summary judgment, within roughly 30 days
- You and your team respond to the summary judgment within 30 days
- The lender replies to your response, typically within a week or two
- A hearing is held, and judgment entered, typically a few weeks or months later, at the next date available to the court
4.) Reinstatement and Redemption
After a judgment has been entered, the process is not yet over. First, there is the matter of reinstatement. Under Illinois law, borrowers may reinstate (i.e., pay back past-due amounts, with fees and interest) within a set period after receiving written notice, or submitting to judicial proceedings.
For borrowers, there is also the redemption period, which must be held before a foreclosure sale can take place. The redemption period is a time in which the borrower in foreclosure must be given an opportunity to pay off their total debt (including principal balance, fees, and interest). In most cases, the redemption period expires three months after the date of judgment.
5.) Notice of Sale is Given And a Foreclosure Sale Takes Place
Following the expiration of the redemption period, a foreclosure sale takes place.
Prior to the sale, notice must be given publicly, and to the homeowner (and any other associated defendants in the lawsuit). Notice of the foreclosure sale must be published in a newspaper for at least three consecutive weeks, at least once per week, with the first notice published no more than 45 days before the date of sale and the last notice published no fewer than seven days before the sale. For homeowners, notice of the sale must be provided at least 10 days prior to the sale.
On the date of the foreclosure sale itself, an auction will be held, typically involving representatives of the bank or lender, and possibly third-party bidders. The house is either sold to the highest bidder, or reverts to the lender. From there, the auction must generally be finalized with a court within a period of 30-60 days, depending on the circumstances.
6.) Approval of Sale and Eviction
Generally, once the outcome of the foreclosure sale is approved and finalized, the court will typically grant the homeowner a certain period to leave the property, generally 30-60 days. If you have not vacated within the set window, you may face action from law enforcement officials, including trespassing charges.
The Value of an Attorney With Experience in Foreclosures
Keep in mind that the above is only intended to be a broad overview of many typical foreclosure proceedings, and is not supposed to be comprehensive. In many ways, your situation may be different, and no two processes will be exactly the same.
Nevertheless, at many steps of the foreclosure process, there are opportunities available to slow things down, delaying the foreclosure and giving you the chance to pursue other remedies (i.e., a short sale, loan modification, and so on).
In these moments and more, it may prove beneficial to have an experienced legal professional on your side. An attorney can assist you in assessing all of your options, developing a workable strategy, and responding to actions taken by your lender or the courts.
Remember that no two cases will be exactly alike! If you have any questions about your unique situation, don’t hesitate to get in touch with the attorneys and staff of the Gunderson Law Firm. The Gunderson Law Firm possesses unparalleled expertise and insight, reinforced by years of experience and long-term connections throughout Chicago’s real estate, finance, and insurance industries.