Libertyville Consent Foreclosure Attorneys

Lawyers for Avoiding Deficiency Judgments in Lake County, Illinois

Illinois is a judicial foreclosure state, which means that all foreclosure proceedings take place within the court system. Illinois is also considered a "recourse" state, which means that a lender who reclaims a property through foreclosure can seek to hold the borrower personally responsible for any "deficiency." A deficiency is the difference between the amount remaining on the foreclosed mortgage and the amount recovered through the foreclosure sale of the property.

At Newland & Newland, LLP, we understand that a large deficiency judgment could have a dramatic effect on your life and your financial stability. We also know that bad things happen to good people, and we are equipped to help you find a solution to your mortgage debt problems. Depending on your situation, a consent foreclosure may be the best choice to avoid the long-term effects of a deficiency judgment.

What Is Consent Foreclosure?

The Illinois Mortgage Foreclosure Law (735 ILCS 5/15, Part 11) provides for the possibility of a consent foreclosure when both the lender and the borrower can agree to the terms of such a deal. In a consent foreclosure, the borrower agrees to give up possession of the property to the lender and the lender agrees to accept the property to settle the remaining debt on the mortgage. With a consent foreclosure, the lender cannot seek a deficiency judgment from the borrower.

A consent foreclosure is similar to a deed in lieu of foreclosure in that both options return the property to the lender in exchange for avoiding responsibility for any deficiency. The two are different in that a consent foreclosure is still considered to be a foreclosure and is handled through the court system. A deed in lieu of foreclosure is an agreement that can prevent or stop foreclosure proceedings, but the agreement does not need to be approved by the court.

Benefits and Consequences of a Consent Foreclosure

At Newland & Newland, LLP, we realize that a consent foreclosure is not guaranteed. The lender must agree to the deal, or traditional foreclosure proceedings can continue. Consent foreclosures are beneficial to borrowers because they eliminate the possibility of deficiency judgments. As a result, many borrowers are able to avoid bankruptcy by using a consent foreclosure. Lenders may be inclined to accept a consent foreclosure as well because the agreement can dramatically reduce the costs associated with foreclosure litigation.

It is important to understand that a consent foreclosure is still a foreclosure, and it will still have an impact on the borrower's credit. Depending on the value of the property and the eventual selling price, there may also be tax implications for waiving the deficiency debt. In most cases, however, a consent foreclosure is preferable to a huge deficiency judgment that could ultimately lead to bankruptcy.

Contact a Foreclosure Attorney in Lake County

If you or a member of your family has been served with foreclosure papers, it is important to act quickly. Our lawyers will meet with you to discuss your situation and help you understand all of your available options. Contact our office today to get the guidance you need in obtaining the fresh start that you deserve. Call 847-549-0000 for a free phone consultation at any of our five locations. Newland & Newland, LLP serves clients in Libertyville, Mundelein, Vernon Hills, Gurnee, Grayslake, Lake Bluff, North Chicago, Arlington Heights, Lake County, and the rest of Northern Illinois.