The following article will cover:
- The potential consequences of letting your home fall into foreclosure.
- Options to consider for those facing foreclosure in Illinois, such as negotiating with the bank, seeking loan modification, and using bankruptcy as a legal tool.
- The viability of these options even if you are already in the foreclosure process in Illinois.
What Are The Potential Consequences Of Letting Your Home Fall Into Foreclosure?
It must be emphasized that no one willingly lets their home fall into foreclosure. Unfortunately, life circumstances can lead people into these situations. Having to choose between basic necessities like food and paying the mortgage is a harsh reality for some. However, it’s crucial to maintain hope that things will improve and that losing a home to foreclosure is not the end of the world.
In Illinois, for instance, if you’re unable to afford your mortgage, you can stay in your home for a substantial period without making payments before facing eviction. This delay can provide precious time to save money and formulate a plan for the future. However, the longer you go without making payments, the more challenging it becomes to save your home if your financial situation improves. In addition to this, foreclosure has a significantly negative impact on your credit score, which can hamper your future financial endeavors.
If you find yourself in this situation and wish to save your home, you can negotiate with the bank to pay back the due amount or use bankruptcy as a legal tool to salvage your property.
Reinstating your loan, i.e., settling all due payments, is the optimal solution as it reinstates your credit standing and provides much-needed relief from the stress of losing your home. Loan modification is another option which may lower your monthly payments, interest rate, or even move your overdue payments to the end of your mortgage term. This option helps you keep your home and has a less damaging impact on your credit compared to foreclosure.
However, it’s important to carefully assess if loan modification will be financially beneficial in the long run, as it could potentially lead to more expenses down the line. Bankruptcy, while having a negative impact on your credit, can halt the foreclosure process if you have the means to make repayments under the agreed-upon plan.
Finally, selling your home can seem like the only viable option for some people, especially if they worry about their credit scores. This is a reasonable course of action if there’s significant equity in the property. However, it’s critical to ensure you have a feasible relocation plan, as selling your home doesn’t shield it from foreclosure, but instead, relinquishes it on your own terms. This action does not negatively affect your credit score.
Can The Previously Mentioned Options Work If I’m Already Facing Foreclosure In Illinois?
Yes, even if you’re already in the process of foreclosure in Illinois, all the mentioned options are still viable. As long as you remain the owner of the property, you can attempt to reinstate your loan, modify it, file bankruptcy, or even sell the property. These options remain viable until the property is sold in a sheriff’s sale and the court confirms the sale. For your primary residence, you may receive an additional grace period of potentially 30 days after the confirmation of the sale.
For more information on Consequences Of A Foreclosure Action In Illinois, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (847) 440-5998 today.