Foreclosure Lawyer Near Me Elgin IL – ASM Law
Foreclosure can be an option for homeowners unable to make their mortgage payments. At ASM Law, we specialize in representing homeowners in situations just like yours. In some cases, it’s possible to prevent foreclosure and stay in your home. In other cases, foreclosure occurs and the proceeds go toward paying the balance of the mortgage. Regardless, it’s essential to have a Foreclosure Lawyer Near Me Elgin IL at your side during the process. Our lawyers will fight for your rights and work hard to obtain the best possible results for you.
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If foreclosure is something you are considering, it’s helpful to know some of the basic terms and parties it involves. Following are some important terms and descriptions that will help you gain a better understand of foreclosure:
-The lender. The lender supplies the loan.
-The borrower. Also known as the homeowner, the borrower is who takes out the loan. The borrower pledges the residential property as security for loan to the lender.
-The investor. This is the party who purchases loans from the lenders. For example, Fannie Mae and Freddie Mac are investors.
-The loan servicer. The borrower makes their monthly payments to their loan servicer. They are frequently, a third party which manages the loan for the lender or investor. A loan servicer’s responsibility includes collection of loan payments. In addition to starting and overseeing a foreclosure in the event a borrower ceases their mortgage payments.
Obviously, purchasing a home requires a significant investment. For that reason, it’s common practice for a buyer to take out a home loan instead of paying in cash. In a home loan transaction, the borrower usually signs a mortgage and a promissory note. Similar to an IOU, a promissory note is a document stating the borrower’s promise to pay the loan.
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A mortgage provides the lender with the authority to foreclose on a property in the event of non-payment. As soon as a lender records a mortgage – which is a form of contract – it establishes a lien on the property.
A promissory note is transferable. Banks frequently purchase and sell mortgages. When this takes place, the promissory note signs over to the party that buys the loan. The seller documents this by recording an assignment of the mortgage in local land records.
Various Ways of Defaulting on a Mortgage
Falling behind on making payments is, naturally, the most typical form of mortgage. However, there are also other ways that default occurs too. For instance, a homeowner probably goes into default for:
-Failing to pay their property taxes. (This assumes the homeowner does not have an escrow account.
-Failure to pay the bill for homeowners’ insurance.
-Allowing the property to fall into disrepair or doing damage that causes the home’s value to fall.
-Transferring the deed to a different owner without first obtaining permission from the lender.
After defaulting on a loan, a lender may demand immediate repayment of the full remaining balance. This action is known as “accelerating the debt.” On occasion, however, the homeowner receives notice before this occurs. This allows a chance to fix the default.
The lender can foreclose if the borrower does not pay the whole loan amount. Although in some situations, federal law mandates that the loan servicer must wait on foreclosure for 120 days.
Talk to a Foreclosure Lawyer at ASM Law
If you are at risk of foreclosure against your home, call our firm today and talk with a foreclosure lawyer. Our firm can assess your situation and recommend ways you can keep your home.
A Look at a Typical Foreclosure Timeline
A loan servicer can’t initiate a foreclosure proceeding until the borrower is at least 120 days overdue on payments. The state’s procedures are what determines which document serves as the first notice of foreclosure. There are two different types of foreclosure: judicial and non-judicial.
A judicial foreclosure is when the law requires that the court takes action for foreclose to move forward. The initial notice is the first document filing at the court to begin the foreclosure. For example, a complaint, notice of hearing or petition.
A non-judicial proceeding is also known as a power of sale foreclosure. The initial filing is simply the first document that’s recorded in local land records. Some state foreclosure laws do not mandate a court filing or the recording of a foreclosure document.
The Purpose of a 120 Day Waiting Period Before Foreclosure Starts
This time period enables the borrower to negotiate a way to prevent foreclosure. If the borrower applies for loss mitigation, it may possibly push out the foreclosure state date even further. The 120 day time period relates to mortgage loans that the borrower secures with property. Usually, that property is the main residence. However, the status of main residence depends upon the particular facts regarding the residential property. As an example, a vacant lot might still serve as a borrower’s primary residence under specific circumstances.
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Smaller loan servicers are exempt from many of the requirements according to federal mortgage service laws. Still, they must comply with the 120 day rule, as long as the property and mortgage fulfil the other applicable criteria. The 120 day rule applies to first and subordinate liens that relate to federal mortgage loans. Although, it doesn’t apply to open lines of credit such as home equity.
When a Foreclosure Proceeding Can Begin Sooner
The 120 day rule doesn’t apply in situations such as:
-When the cause of the foreclosure proceeding is violation of the due-on-sale clause. Many home loan contracts feature this provision. It basically states that if the borrower transfers the property to another party, the lender can accelerate the balance. Consequently, the borrower must repay the whole balance of the home loan to prevent a foreclosure from starting. Although, federal law does restrict the enactment of a due-on-sale clause in some situations.
-When the loan servicer joins the foreclosure proceeding of a superior or a subordinate lien holder.
If you believe that your home loan servicer improperly begins foreclosure before the 120 day period ends, call ASM Law. It might be possible to prevent the foreclosure or at least delay it temporarily. This can provide you with valuable time for reaching an alternative such as loan modification.
ASM Law – Protecting Your Rights in Foreclosure
Alternatives to Foreclosing on Your Home – Loss Mitigation
Loss mitigation is what the home loan industry calls it when borrowers and their loan servicers coordinate to stop foreclosure. There are different loss mitigation alternatives such as loan modification, short sales, forbearance agreements and repayment plans. Perhaps among the most common forms of loss mitigation is a loan modification. Generally, it involves negotiations between borrower and loan servicer toward reducing the monthly mortgage payments. Naturally, the goal is to lower the payments so they are more affordable for the borrower. There are a number of reasons why this is an appealing option for the borrower. From job loss or hospital bills to divorce, it’s not unusual for one’s financial situation to suddenly change. Obtaining a loan modification can make the difference between keeping or losing a home.