Foreclosure is one of the most dreaded dealings that a home owner would ever face. When an individual or family purchases a home, the general intention is to own it long term. The last thing anybody would want is getting a notice of foreclosure. Foreclosures are in the rise in Illinois partly due to recession and partly due to lack of proper financial management. Now, you may be wondering what exactly is a Foreclosure in Illinois. Is it same as Chapter 13 bankruptcy Illinois ? When you are unable to clear mortgage payments on your home in Illinois in a timely fashion, your bank or other secured creditor will initiate foreclosure proceedings. This happens when the past due mortgage payments compound over time; however, many people do not reach the final stages of home foreclosure.
Reasons for foreclosure in Illinois
The main reason leading to home foreclosure has been found to be sudden unemployment which could occur due to layoffs, ill health or accidents. Generally during purchase banks scrutinize the loan repayment capacity of the potential home buyer and only provide loans to favorable applicants. It is only natural that when an individual's career is put on hold, they will not be able to support the mortgage payments. In addition to that, unplanned financial expenditures, such as those due to inflation and accidents result in a large financial toll, which directly correlates to unmet mortgage payments, therefore resulting in foreclosure.
Avoiding foreclosure in Illinois
A Chicago real estate attorney can help you avoid foreclosure. The most efficient way to stop foreclosure is to simply avoid putting oneself into that situation by building up an emergency financial fund. If things happen too suddenly and you are not able to handle it, the immediate course of action to take would be to call the bank or lender or make a mortgage modification or decrease in mortgage payments application, explaining the temporary delay in non-payment. A negotiation can prevent immediate foreclosure. This process is also known as forbearance, where the bank temporarily avoids taking legal actions to obtain payments, and instead assigns a time period of gratification. Besides that, banks often increase the loan period (which results in decreased payments), so that payments become easier to make. For example, a 15 year $1,500 of monthly payment can be changed into a 26 year $900 of monthly payment process. Even though it is not recommended, one can also acquire separate loans on new terms to pay for the existing loans. Although this is a temporary solution and provides relief for a while, the interest rates from both loans compounds over time. However, for recovering individuals that expect a future increase in salary, this is a feasible method for avoiding foreclosure.
To know more about foreclosure please visit www.changandcarlin.com
Reasons for foreclosure in Illinois
The main reason leading to home foreclosure has been found to be sudden unemployment which could occur due to layoffs, ill health or accidents. Generally during purchase banks scrutinize the loan repayment capacity of the potential home buyer and only provide loans to favorable applicants. It is only natural that when an individual's career is put on hold, they will not be able to support the mortgage payments. In addition to that, unplanned financial expenditures, such as those due to inflation and accidents result in a large financial toll, which directly correlates to unmet mortgage payments, therefore resulting in foreclosure.
Avoiding foreclosure in Illinois
A Chicago real estate attorney can help you avoid foreclosure. The most efficient way to stop foreclosure is to simply avoid putting oneself into that situation by building up an emergency financial fund. If things happen too suddenly and you are not able to handle it, the immediate course of action to take would be to call the bank or lender or make a mortgage modification or decrease in mortgage payments application, explaining the temporary delay in non-payment. A negotiation can prevent immediate foreclosure. This process is also known as forbearance, where the bank temporarily avoids taking legal actions to obtain payments, and instead assigns a time period of gratification. Besides that, banks often increase the loan period (which results in decreased payments), so that payments become easier to make. For example, a 15 year $1,500 of monthly payment can be changed into a 26 year $900 of monthly payment process. Even though it is not recommended, one can also acquire separate loans on new terms to pay for the existing loans. Although this is a temporary solution and provides relief for a while, the interest rates from both loans compounds over time. However, for recovering individuals that expect a future increase in salary, this is a feasible method for avoiding foreclosure.
To know more about foreclosure please visit www.changandcarlin.com
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