Chicago, popularly known as wind city follows the foreclosure laws of Illinois. Chicago foreclosures are generally done through judicial intervention and supervision. Along with judicial foreclosure, Deed in Lieu and consent foreclosures is also prevalent here. Foreclosed properties in Chicago cost around $ 234,325 and it can save you up to 43 % compared to market price. Purchasing foreclosed properties is some different from the process of purchasing normal properties. There are several legal and financial processes are associated with foreclosed properties. For a better deal you need to have basic knowledge on these processes. In this article we have tried to simplify the process of foreclosure in Chicago.
Repo homes or the reposed homes are the result of substantial default in repayment of home equity loans. In Illinois, mortgage is the prime credit instrument. Lenders approve home equity loans on the basis of deed of trust. This deed makes lender an equal lien holder during the repayment period of home equity loans. Breach of trust on behalf of the borrower forces the lender to take judicial help. Here, the lender tries to the cease borrower’s right on the pledged property and sell the property to recover his money. Foreclosure pleas are generally passed in favor of the lender. However, before approval, court hears to all parties involved with the property. Repo homes are sold through auction.
Deed in Lieu foreclosure is an amicable way of foreclosure where the role of judiciary is limited. Here, the borrower is pretty sure about his financial condition and remote chances for repayment of the loan amount. Hence he hands over the title of the property to the lender. The lender has to move court to renew the title in his name. Deficiency judgment is not allowed if it is deed in lieu foreclosure. In case of consent foreclosure, court offers the absolute mortgage on the property to lender by ceasing borrower’s right of redemption. Like judicial foreclosure, these properties are also sold through open auction.
There are several reasons behind the phenomenal growth of Chicago Foreclosures in recent times. Global economic crisis has made the job market more volatile than ever. Job cuts and losses are restricting the income source of people. After sub-prime market crisis availability of unsecured loans is also now at all time low. In such a situation, homeowners are not able to maintain regularity in payment of home equity loans and their properties are being foreclosed.
