Day 1 – First of Month
Your monthly mortgage payment is due on the first day of the month. You cannot make the payment.
Day 10 to 15 – Middle of Month
Depending on your lender terms of your loan, your loan becomes late on either the 10th or 15th day of the month. At this point, you owe your monthly payment and also a late charge. The lender receives computer notification that you have missed your payment and a automated late notice is usually sent out to you by mail. In addition, the lender will attempt to call at all available phone numbers listed on your loan you concerning your payment.
Day 31 – First of Next Month
You are now into the second month in which you have not made a payment. The Lender Collection Department is notified and you receive more calls. Your credit report is now showing a mortgage deficiency.
(30 Day Notice) = clock ticking
Day 45 to 60 – Middle of Month
You will receive a notice from the lender that you are in “Breach of Contract” and that you have 30 days to cure your late payments and bring them up to date. At Day 60, your credit report shows that you are 60 days late.
Day 90 – Beginning of Month
If no payments have been made, foreclosure proceedings may start. A”Notice of Default” is filed with your county. A sheriff or process server will attempt to serve you personally first and then you will be notified by the notice by Certified Mail, Return Receipt. Now you have 90 days to cure the default. Normally, You will no longer receive any correspondence from the lender. You are left to your own actions.
Most people start to panic here.
What Alternative Solutions are available?
Day 180 – Three Months Later
At this point, you may receive the Notice of Foreclosure Sale. You may find a notice taped to your front door. It might be published in the local newspaper. The Notice will state the location, date and time that your home will be sold at auction. It will give you a phone number to call to attempt to reinstate your loan. This can only be done by paying the past due amount, including legal fees and costs, or by refinancing.
Day 201 – Three Weeks Later
At this point or any time thereafter, your home will be auctioned at the local courthouse. Either a person will buy it or it will be owned by the lender.
– Judicial Foreclosure Available: Yes
– Non-Judicial Foreclosure Available: No
– Primary Security Instrument: Mortgage
– Timeline: Typically 210 days
– Right of Redemption: No
– Deficiency Judgments Allowed: Yes
Lenders in Illinois have a number of options available to them to foreclose on a mortgage in default.
A notice of the lenders intent to foreclose must be given to the borrower, and any other person entitled by Illinois statutes to receive notice, at least thirty (30) days prior to the courts judgment of foreclosure.
If the court finds in favor of the lender and issues a notice of sale, the sale will be conducted on the terms and conditions specified in the notice of sale, provided they meet the minimum standards provided in the Illinois Statutes.
The sheriff or any judge within the county where the property is located may conduct the sale. The borrower has no rights of redemption after the foreclosure sale.
Deed in Lieu of Foreclosure
If the borrower has defaulted on the mortgage and the lender agrees, the borrower may simply give the deed to the lender and his interests in the property securing the deed will be terminated. If the lender agrees and accepts the deed, they may not seek to obtain a deficiency judgment against the borrower at any time afterward.
In this type of foreclosure, the court enters a judgment satisfying the mortgage by giving absolute title to the property secured by the mortgage to the lender. The borrower has no rights of redemption after this type of foreclosure judgment has been rendered and the lender may not file for a deficiency judgment.
Lenders may also foreclose on a mortgage in default by using the common law strict foreclosure method, but Illinois law does not permit non-judicial power of sale foreclosures.