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.