Financial Relief Extended for Foreclosures and Evictions in Illinois

 Posted on October 20, 2020 in Foreclosure

The impact of COVID-19 has been widespread, with public health concerns as well as an economic downfall. In response to stay-at-home and quarantine orders issued by local governments, non-essential businesses were forced to close. As a result, many people throughout the United States have lost their jobs. This has resulted in a record-setting number of unemployment claims, but it also left millions of people facing housing insecurity because of lost income. For families, even one parent losing his or her job can be devastating if they rely on that income to pay their rent or mortgage. When too many payments are missed, the lending institution can take possession of the home through legal foreclosure proceedings. If you are facing foreclosure on your home, you may be eligible for a loan modification. 

What Is Involved in the Foreclosure Process? 

Foreclosure is a legal process by which a lender attempts to recover the balance of a loan from a borrower who has defaulted on the loan. Usually, this means that the borrower stopped making payments to the lender, and foreclosure works by forcing the sale of the asset used as the collateral for the loan. In Illinois, foreclosures are judicial, which means the lender (the plaintiff) must file a lawsuit (a complaint) in court. The complaint is served to the borrower, along with a summons that typically provides 30 days for the borrower to file an answer.

CARES Act 

In response to this housing crisis, the federal government implemented certain protections for tenants and mortgage loan borrowers under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Renters who were residing in properties that had federally backed mortgages could not be evicted or fined for nonpayment of rent for 120 days between March 27 and July 24, 2020. After the four months were up, landlords were permitted to give tenants 30 days’ notice to vacate the premises. However, agencies including the Federal Housing Finance Authority (FHFA) and Federal Housing Administration (FHA) have now extended their single-family moratorium on evictions until December 31, 2020.

Two-thirds of the residential mortgage loans in this country are federally backed mortgages. Under the CARES Act, there was a 60-day hold on foreclosures that started March 18, 2020 for those who sustained losses due to COVID-19. These homeowners qualified for 180 days of relief, and could also request another 180 days if necessary. In addition, if people own multi-family dwellings, they can access forbearance for up to 90 days as long as they do not evict their tenants or issue late fees for nonpayment of rent. 

On September 1, 2020, the Centers for Disease Control and Prevention (CDC) issued additional protections for tenants across the nation. A temporary moratorium to protect renters from being evicted was put in place through the end of the year. Different from the CARES Act, which provided a temporary moratorium for properties with mortgages that are federally backed, the CDC’s order aims to extend financial relief to all residential properties occupied by renters who fall within a designated income level, applied for government assistance, lost income due to the coronavirus pandemic, and would be homeless if they were evicted. 

Contact a McHenry County Foreclosure Defense Lawyer

Coronavirus has affected our way of life during the past year. Many people have faced health risks and job losses. The thought of losing your house can also be devastating. At Newland & Newland, LLP, we can help you fight your foreclosure so you can keep your home during these uncertain times. Our knowledgeable Waukegan loan modification attorney will assist you with exploring your options and the legal steps to take in your foreclosure defense. To schedule a free consultation, call us today at 847-549-0000.

Sources:

https://www.cbpp.org/research/housing/extend-cares-act-eviction-moratorium-combine-with-rental-assistance-to-promote

https://home.treasury.gov/policy-issues/cares

https://www.cnn.com/2020/08/27/success/freddie-fannie-foreclosure-eviction-moratorium-extended/index.html