Foreclosure is the procedure through which the lender in a mortgage takes ownership and/or possession of the property that secured the original loan. This happens when a debtor in Mendota, Illinois has consistently failed to make their payments. Foreclosure typically involves a forced sale of the house at auction. Banks typically want to rid themselves of ownership of the home as soon as possible, collect as much money as they can, and then move on.

In all states in the United States, including Illinois, foreclosure by judicial sale is an option. This allows the sale to be done under the supervision of a court, to ensure that the bank makes a good faith effort to get a fair price, and that the proceeds above and beyond the balance of the mortgage (if there are any) go back to the debtor. In some states, original mortgages are "non-recourse loans," meaning that the lender may only recover ownership of the house in the event of default. If the house is now worth less than the balance of the mortgage, the lender has to take the loss. You should speak with a Mendota, Illinois attorney to see if this state is one of them. However, it is almost always the case that this protection does not apply to loans that have been refinanced.

How Can I Avoid Foreclosure in Illinois?

Most importantly, you must not dismiss the problem. Doing so will not make it go away, and will probably make it worse. You should stay in close contact with your bank, and be forthright with them. It is important to remember that banks don't really want to own homes in Mendota. In issuing a mortgage, they expect to make a profit through interest on the loan, and they'd prefer to continue collecting from you. Therefore, they're likely to make reasonable accommodations to your financial situation if it will allow you to keep paying them in the long run.

If you can't work things out with your lender, there are other avenues. You can try a "short sale," which is when you sell your house for whatever amount you can get for it, and use the proceeds to pay your mortgage. If the house sells for less than you owe, the bank still receives those proceeds, but the remainder of the loan will be forgiven. You might also consider a "short refinance" which allows a part of the debt to be forgiven, and lets you refinance the rest.

How Can A Mendota, Illinois Attorney Help?

If you are facing the possibility of foreclosure, a good Mendota, Illinois real estate lawyer can help. At the very least, they will be able to inform you of your legal options.