A recent case, Citimortgage, Inc. v. Cotton, 2012 IL App (1st) 102438 (August 28, 2012), highlights the important of proper service on the defendant mortgagor in a foreclosure case. Mr. Cotton was a City of Chicago fireman who had a loan with CitiMortgage on a five-unit residential building in Chicago. The building went into foreclosure, and the process server hired by the lender attempted service on Mr. Cotton ten times at the building. He later filed an affidavit that he had attempted service ten times and was unable to serve Mr. Cotton. The bank had an alternate address for Mr. Cotton as well, also at an apartment building. Another process server eventually filed an affidavit that he had attempted to serve Mr. Cotton nine times at the alternate address, and was unable to serve him there either. Citimortgage then obtained permission from the court to serve the defendant via publication, and published in the Chicago… read more →
In February, the federal goverment and state attorney generals announced a $25 billion settlement with five large national banks for “robosigning” foreclosure paperwork. Illinois is receiving a portion of that money, somewhere betwen $1 – $1.5 billion. Our state attorney general announced her intention to distribute $20 million of the settlement funds for legal aid, and the first funds are finally filtering through. The Legal Assistance Foundation will receive about $4.7 million of the settlement funds. This money is intended to expand legal services to distressed tenants and homeowners in Cook County. Specifically, the Legal Assistance Foundation hopes to have twenty attorneys and paralegals working on cases involving distressed homeowners and tenants. They also plan to conduct seminars designed to provide legal traning in foreclosure defense and bankruptcy. Lastly, they hope to work with teh courts to improve the Cook County Foreclosure Mediation Program.
According to the Illinois Association of Realtors, in July 2012, home sales in the general Chicago area (comprising of Cook County and eight other counties) increased by 29 percent over July of 2011. Overall, 8,551 homes sold. The median sales price was the highest it’s been this year. While movement in the market is good news, it must be noted that the price of homes sold in July 2012 decreased nearly 6% overall in the nine counties comprising the study since July 2011. The city of Chicago fared better: prices dropped only 2.4 percent in the city when compared to last summer, and condominium prices only dropped .8 percent, while condominium sales increased by 25 percent. Dupage County prices fared the best — there was an increase of a little over 1 percent since last summer. Regardless of price fluctuations, there is a great deal of inventory out there. A larger volume of sales ,… read more →
A couple of weeks ago, the governor signed some new laws into effect affecting mortgage brokers. The Residential Mortgage License Act of 1987 was amended with the intention of protecting consumers from fraudulent lending practices. The gist of the amendments is this: 1) Mortgage companies will pay higher licensing fees. Previously, the annual licensing fee was $2,042. Now it will be $2,700. 2) Applicants may have to undergo more extensive background checks. 3) The penalties for mortgage fraud have tripled, from $25,000 to $75,000. 4) There is some added protection in place for mortgage licensee whistleblowers who report fraudulent activity.
In a case that made it all the way to the U.S. Supreme Court, plaintiffs alleged that their lender, Quicken Loans, violated the Real Estate Settlement Procedures Act (RESPA) by charging loan processing and loan discount fees. The plaintiffs claimed that the fees Quicken charged them were not tied to specific services, nor did they lead to a reduction in the plaintiffs’ loan costs. Therefore, the plaintiffs alleged that the loan processing and discount fees violated Section 8(b) of RESPA, which prohibits unearned fees. The Supreme Court, however, sided with Quicken Loans, affirming the defendant’s argument that Section 8(b) of RESPA applies only to fees that are split with another settlement service provider. Since the fees in question were not split with any other party, and since the plaintiffs had never alleged that the fees were split with another party, the case was decided in Quicken Loans favor.
Tax exempt organizations who qualify and who are willing provide foreclosure mediation services may receive a portion of the funds obtained through a $25 billion settlement earlier this year with five large banks accused of “robo-signing” foreclosure documents. $3 million have been allocated to fund foreclosure mediation programs in Illinois, specifically for counties that do not currently have such programs. Increased and better foreclosure mediation may help homeowners avoid foreclosure, and instead work out a loan modification, short sale, or other acceptable solution. Interested tax-exempt organizations may apply for a multi-year grant by August 15. The Illinois Attorney General’s office can provide details to interested organizations.
As a result of discriminatory lending allegations, last week Wells Fargo entered into a $175 million settlement agreement with the government. The U.S. Attorney General’s office states that Wells Fargo discriminated against 34,000 homeowners of Hispanic and African American origin nationwide. According to some estimates, at least 3300 of these homeowners were in Illinois. Illinois victims are expected to receive $15 million in aid. Of the $15 million, $8 million will be in the form of cash payments. Homeowners who were steered into subprime loans can expect to get approximately $15,000 each. Homeowners who were charged higher fees for their loans can expect approximately $2000 each. Of course, each homeowner’s case will have to be individually assessed to determine the exact relief. The balance of the Illinois settlement, $7 million, will be used for down payment assistance for Illinois borrowers.
In a recent appeal of a foreclosure, National Advantage Mortgage Company v. Ortiz, 2012 IL App (1st) 112755 (June 29, 2012) Cook Co., 6th Div., the foreclosed property owner lost despite his assertion that the the plaintiff bank lacked standing to foreclose him when it filed the foreclosure suit. In October of 2009, the bank filed a foreclosure action against Mr. Ortiz, the mortgagor. In March of the following year, the bank was granted judgment of foreclosure. After the judgment, Mr. Ortiz tried to dismiss the bank’s complaint on the grounds that when the bank filed the foreclosure suit in October, it did not own the note. The note was, in fact, not assigned to the bank until November 4, 2009. The trial court granted Mr. Ortiz’s motion to dismiss, and allowed the bank 30 days to file a motion to reconsider. In the interim period, the appellate court rendered its decision in Mortgage Electronic Registration Systems, Inc. v. Barnes, 406… read more →
I haven’t seen any pigs flying yet. And it was 102 degrees when I arrived at work this morning, so I’m guessing hell has not frozen over either. BUT the unimaginable HAS happened, at least in the world of real estate. Cook County second installment tax bills arrived in the mail on Monday, July 2, 2012. Back in April, there was a rumor this might happen — that our tax bills might arrive on time for the first time in over 40 years. And now it has happened. The tax bills have arrived, and are due, as per statute, on August 1, 2012. The statutory deadline for second installment taxes has been ignored for years in Cook County, because the bills are never out by the deadline. But this year they are, so taxpayers, get out your checkbooks. What next? Will the Cubs win the World Series this year?
Do you qualify for a Cook County senior exemption on your real estate tax bill? You may, if you meet the criteria outlined below. If you do, make sure you apply for the exemption on an annual basis (unlike past years, you have to apply annually now to preserve your senior exemption). 1. You have to be at least 65 years old (in the tax year for which you are applying for the exemption).2. The property you are applying for must be your primary residence.3. You must be the owner of the property. If you are not the owner, then you must have a lease for the property which states you are responsible for the payment of real estate taxes. If you submit your application, and you qualify for the senior exemption, you will receive a deduction on your second installment tax bill. Also, if you apply for the senior… read more →