Oftentimes, it is possible for homeowners who want to save the equity they have invested in their homes to avoid foreclosure, even if they have missed multiple payments. Speaking with an attorney about their options is usually a good place to start “fighting back” against the risk of foreclosure. Yet, there are times when fighting back against this risk might not be in a homeowner’s best interests. Due to the nature of their circumstances, engaging in a so-called consent foreclosure may be preferable.
Safeguarding the Interests of Homeowners in Specific Ways
In the event of a “traditional” judicial foreclosure, a home is sold by a lender that is owed repayment for a home loan that is in default. The former owner of that home is usually responsible for repaying any outstanding amount owed to the lender. If the lender does not receive this repayment, it may seek a deficiency judgment. To enforce that deficiency judgment, the lender may seek to garnish the former owner’s wages or even seize the contents of their bank account.
If a homeowner no longer wants to be burdened by their mortgage obligations or simply cannot avoid a foreclosure, they may be able to avoid the risk of a deficiency judgment and the challenges of repaying the amount they still owe their lender through a consent foreclosure.
A consent foreclosure essentially occurs when a homeowner proactively agrees to allow a foreclosure to proceed without fighting back. It is a settlement process of sorts. In exchange for making the foreclosure process less costly for the lender, the lender agrees to remove liens from the home’s title and to waive its right to seek a deficiency judgment for any balance that remains outstanding after the home is sold.
Connect with a Dedicated Lake County, IL Real Estate Lawyer for Personalized Insight
If your home is at risk of being foreclosed upon and you are unsure of how to proceed, schedule a free case evaluation today with the experienced North Chicago, IL real estate lawyers at Newland & Newland, LLP to learn about how we can help. Once you have been informed about the ways in which the law applies to your situation and how each opportunity available to you – from consent foreclosure to short sales, loan modifications to utilizing a deed in lieu of foreclosure – may affect your circumstances, you will be able to take your next steps in informed and empowered ways.
Our team understands how challenging the risk of foreclosure can be and how stressful it can be to weigh the benefits and drawbacks of various responses. Know that we are here to help and that we will treat you and your investment in your home with great respect and consideration. Call 847-549-0000 or reach out via our firm’s contact page to get started.
Source:
https://www.ilga.gov/legislation/ilcs/fulltext.asp?DocName=073500050K15-1402