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Fioretti Foreclosure Workshop


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Fioretti Foreclosure Workshop

  1. 1. Presented July 19,2011 Mario Pantoja, Director Illinois Department of Financial and Professional Regulation William Smirniotis Illinois Licensed Real Estate Broker
  2. 2. Who Owns My Loan? <ul><li>Determining if your mortgage is Fannie Mae </li></ul><ul><ul><li> / </li></ul></ul><ul><ul><li>Must verify that you are owner or have owner’s consent </li></ul></ul><ul><li>Determining if your mortgage is Freddie Mac </li></ul><ul><ul><li> </li></ul></ul><ul><ul><li>Must verify that you are owner or have owner’s consent </li></ul></ul>
  3. 3. Homeowner Protection Act <ul><li>Law signed by Governor Quinn in April 2009 </li></ul><ul><ul><li>On Aug. 2, 2010, Gov extended HPA thru July 1, 2013 </li></ul></ul><ul><li>Gives consumers who fall behind on their mortgage payments a 90-day “grace period” during which the lender cannot begin foreclosure </li></ul><ul><li>During the 90-day period, a consumer can, with the help of a housing counselor, negotiate a workout plan with the lender </li></ul>
  4. 4. HPA Eligibility <ul><li>At least 30 days behind on your mortgage payments </li></ul><ul><li>Received a notification from your lender or servicer about your right to seek housing counseling </li></ul><ul><li>Exercise your right to housing counseling and get the full 90 days! </li></ul><ul><li>One-time only per mortgage </li></ul>
  5. 5. HPA Eligibility
  6. 6. Additional Protections <ul><li>On August 2, 2010, Governor Quinn signed the Save Our Neighborhoods Act of 2010. </li></ul><ul><ul><li>Lenders will pay a $50 fee when they file a foreclosure complaint in court </li></ul></ul><ul><ul><li>Fees will go toward foreclosure prevention efforts, including grants to community-based groups to connect homeowners with counseling help and foreclosure prevention programs </li></ul></ul>
  7. 7. Mortgage Fraud in Illinois
  8. 8. <ul><li>The Mortgage Fraud Task Force was established by the IDFPR to ensure that mortgage companies comply with the strict standards of conduct established by state laws </li></ul><ul><li>Since its inception, the MFTF has taken disciplinary action against more than 150 persons and entities and assessed fines in excess of $2 million and conducted a regulatory sweep of more than 150 mortgage companies </li></ul>Homeowner Protection Initiatives
  9. 9. <ul><li>BEWARE of anyone who says they can “save” your home if you sign or transfer over the deed to your house </li></ul><ul><li>DO NOT sign over the deed to your property to any organization or individual unless you are working directly with your mortgage company and have YOUR OWN lawyer or housing counselor </li></ul>Beware of Foreclosure Rescue Fraud
  10. 10. Avenue of Broken Dreams <ul><li>South Side bungalow of 75-year-old woman was “stolen” by people she trusted </li></ul><ul><li>“ Friends” persuaded her into signing documents, including the deed to home of 30 years </li></ul><ul><li>IDFPR uncovered a slew of fraud and is actively battling to help woman keep her home </li></ul>
  11. 11. IDFPR Enforcement Successes 2007-Present
  12. 12. IDFPR Enforcement Successes <ul><li>MFTF wins 2010 CLEAR Investigative Excellence Award </li></ul><ul><li>The Council on Licensure, Enforcement and Regulation (CLEAR) honored task force for its two-year “Avenue of Broken Dreams” investigation </li></ul>2010
  13. 13. <ul><li>“ If it sounds too good to be true…” </li></ul><ul><ul><li>Do not offer or agree to sell your name and/or credit to help keep “someone else” from losing their home or purchase a home </li></ul></ul><ul><ul><li>This is commonly referred to as “Straw Buying” but is better known as Fraud </li></ul></ul><ul><li>“ Thou shall not covet thy neighbors goods…” </li></ul><ul><ul><li>Many mortgage scam victims are approached by persons they know and trust through church and other religious activities </li></ul></ul> Don’t Become a Victim to Predators
  14. 14. <ul><li>There is NEVER a fee to get assistance or information about the Making Home Affordable from your lender or a HUD-approved housing counselor </li></ul><ul><li>BEWARE of any person or organization that asks you to pay a fee in exchange for housing counseling services or modification of a delinquent loan </li></ul> Don’t Become a Victim to Predators
  15. 15. <ul><li>If you feel you have been duped during a residential loan transaction, or have paid someone for a loan modification file a complaint with the Illinois Department of Financial and Professional Regulation TODAY!!! </li></ul><ul><li>Or, by mail: IDFPR </li></ul><ul><li> James R. Thompson Center </li></ul><ul><li> 100 W. Randolph Street, 9th Floor </li></ul><ul><li>Chicago, Illinois 60601 </li></ul><ul><li>By phone: (800)-532-8785 </li></ul><ul><li>Online: </li></ul>File a Complaint…TODAY!
  16. 16. Foreclosure <ul><li>A judicial proceeding by lender/servicer to obtain judgment against the borrower for his/her breach of promise to pay </li></ul><ul><li>Lender/servicer takes borrower’s interest in the house, which was given as security for the promise </li></ul><ul><li>Summons </li></ul><ul><ul><li>An order to appear in court to respond to the foreclosure complaint </li></ul></ul><ul><ul><li>Do not ignore this information </li></ul></ul>
  17. 17. What are my options? <ul><li>Refinance </li></ul><ul><ul><li>Pay off the entire mortgage </li></ul></ul><ul><ul><li>New loan with affordable monthly payment </li></ul></ul><ul><ul><li>Current employment is necessary </li></ul></ul><ul><li>Workout </li></ul><ul><ul><li>Lender/servicer agrees to new payment plan </li></ul></ul><ul><ul><li>Can you afford the proposed plan? </li></ul></ul><ul><ul><li>Seek legal advice before signing </li></ul></ul>
  18. 18. Options <ul><li>Short Sale </li></ul><ul><ul><li>Agreement by lender/servicer to sell the property for less than is owed on a mortgage </li></ul></ul><ul><li>Deed in lieu </li></ul><ul><ul><li>Borrower surrenders property to lender to satisfy the loan and avoid foreclosure proceedings </li></ul></ul><ul><ul><li>Does not satisfy junior liens </li></ul></ul><ul><ul><li>Be aware of future liabilities! </li></ul></ul><ul><ul><li>Seek legal and tax advice! </li></ul></ul>
  19. 19. Options <ul><li>Apply for a modification through President Obama’s Making Home Affordable Plan </li></ul><ul><ul><li>Today begins this process </li></ul></ul><ul><li>Meet with a HUD approved counselor </li></ul><ul><ul><li>You have the ability today to meet with a counselor even if your lender is present </li></ul></ul>
  20. 20. Options <ul><li>Graceful Exit </li></ul><ul><ul><li>HUD counselor can assist in this process </li></ul></ul><ul><ul><li>Opportunity to rebuild your credit </li></ul></ul>
  21. 21. Foreclosure Steps <ul><li>Court Hearing </li></ul><ul><ul><li>Borrower may appear in person or by a lawyer and contest the foreclosure </li></ul></ul><ul><ul><li>If no appearance, a default judgment may be entered and all proceedings continue </li></ul></ul><ul><ul><li>Many counties grant a continuance just for appearing in court. </li></ul></ul>
  22. 22. Foreclosure Steps <ul><li>Reinstatement </li></ul><ul><ul><li>Within 90 days within the date of service, a borrower may reinstate the loan by fulfilling all payments, including fees and costs </li></ul></ul><ul><ul><li>Loan continues as normal </li></ul></ul><ul><li>Public Auction </li></ul><ul><ul><li>If property is not redeemed, judicial sale is held like an auction </li></ul></ul>
  23. 23. Foreclosure Steps <ul><li>In the end… </li></ul><ul><ul><li>If the property could not be saved, the foreclosure is completed </li></ul></ul><ul><ul><li>Eviction </li></ul></ul><ul><ul><li>Work with the lender for a graceful exit </li></ul></ul>
  24. 24. Important <ul><li>Contact your lender/servicer as soon as you think you cannot make a payment, or contact a HUD-certified housing counselor in your community </li></ul><ul><li>Do not ignore telephone calls or correspondence from your lender/ servicer. The sooner you call, the better. Lenders do not want your house. </li></ul><ul><li>Do not seek assistance from individuals who make you an offer that is too good to be true </li></ul>
  25. 25. <ul><li>If you feel you have been duped during a residential loan transaction, file a complaint with the Illinois Department of Financial and Professional Regulation TODAY!!! </li></ul><ul><li>Or, by mail: IDFPR </li></ul><ul><li>James R. Thompson Center </li></ul><ul><li> 100 W. Randolph Street, 9th Floor </li></ul><ul><li>Chicago, Illinois 60601 </li></ul><ul><li>By phone: (800)-532-8785 </li></ul><ul><li>Online: </li></ul>File a Complaint…TODAY!