Mortgage payments bite deep into the budgets of homeowners in Chicago and throughout Illinois. For a variety of reasons, you may have fallen behind on payments. Failing to make your mortgage payments puts you at risk of foreclosure. This is the process by which your lender evicts you from the home and sells it to recover what is owed.
When a foreclosure starts
Late fees and penalties start as soon as you miss your first mortgage payment. After three to six months of missed payments, your lender will send a “Demand Letter” or “Notice to Accelerate” that warns you to pay of face foreclosure proceedings.
Because Illinois is a state that requires judicial overview of foreclosures, you can expect to see a summons to appear in court at about the same time. Because courts have crowded schedules, you will probably gain more time to prepare your response to the foreclosure because your court date may be weeks or months in the future.
Why your lender can take your home
Lenders counter the risk of lending people large sums to buy houses by securing loans with the property as collateral. This is done with the mortgage document that places a lien on your property. A lien officially grants the lender a right to seize the property if the loan is not repaid.
Your options for dealing with foreclosure
The thought of losing your home is distressing, but the foreclosure process takes several months, which means you may have time to fix the situation. You might succeed in negotiating a new payment plan that halts the foreclosure. In other situations, you could arrange a short sale through your lender that allows you to settle the debt and time to find a new place to live that you can afford.