New Bill to Fast Track Foreclosures
What would the new bill accomplish?
First, the bill would charge more money to banks who file frequent foreclosures. Any lender that filed at least 175 foreclosures in the last year would have to pay an additional $500 for every new foreclosure complaint it files. Lenders that filed between 50 and 174 foreclosures in the last year would be charged an additional $250 per new filing, and lenders that filed between 1 and 49 foreclosures in the last year would pay an additional $50 per new complaint. With the amount of foreclosures filed annually, it is estimated that an additional $41 million in revenues will be collected in the year after the law takes effect.
Second, the fees collected for the foreclosure filings would be used for the benefit of homeowners and communities. Specifically, thirty percent of the funds collected would go towards counseling and foreclosure prevention services for people in danger of being foreclosed. The rest of the funds would be distributed to municipalities to help them maintain abandoned properties.
Third, the bill would speed up the foreclosure process for certain types of properties. Instead of taking eighteen months to two years to be foreclosed, abandoned single family homes, condominiums and townhouses could be foreclosed within 100 days. Apartment buildings with six or fewer units that are not owner-occupied could be fast-tracked also. Moreover, homes that are under construction but where construction activity has ceased for at least six months could be foreclosed quickly also, if there has been damage to the property. Speeding up the foreclosure process will help get these properties to market quickly, instead of allowing them to become rundown and potentially dangerous, blighting the community.
Keep in mind that homes that are going through the probate process, as well as vacant buildings that are for sale but compliant with all local regulations and are safe and locked up, are not subject to this new bill.
Fourth, if the property being foreclosed is in Chicago, the local alderman will receive a notice of foreclosure for properties in his or her ward.