My wife and I own a home in Chicago, Illinois. A few months ago my wife lost her job and we fell behind in our mortgage payments. (I’m a stay-at-home dad.) The house is now in foreclosure. We love living here and would like to hold on to the house. Neither of us is currently working, but I’m expecting a big inheritance soon. Is there any way for us to get the house back if we lose it to foreclosure?
Maybe. You'll get some time before the foreclosure sale—and perhaps after—to “redeem” your home. To redeem before the sale, you'll have to pay off the full amount of the loan, plus various costs. To redeem afterwards, you'll have to pay the foreclosure sale price plus interest and costs.
In a nutshell, here are the rules for redeeming the home (which are explained in more detail below):
Illinois foreclosures are judicial, which means the lender must file a lawsuit in court to foreclose your home. After the lender gets a judgment for foreclosure from the judge, your home will be sold at a foreclosure sale. (To learn more about foreclosure in Illinois, see Illinois Foreclosure Laws and Procedures.)
In Illinois, you can redeem your home until the later of:
The foreclosure sale may not be held until after this redemption period expires.
In order to redeem, you must pay the amount specified in the judgment—including principal, interest, fees, and costs—plus any additional expenses incurred between the date of judgment and the date of redemption. (735 Ill. Comp. Stat. 5/15-1603(d).)
You get a special right to redeem for 30 days after the court confirms the foreclosure sale if:
To get your home back through the special right of redemption, you’ll have to pay the foreclosure sale price plus interest and costs. (735 Ill. Comp. Stat. 5/15-1604.)
If the court finds that you abandoned the home (left it), the redemption period expires 30 days after the foreclosure judgment date. (735 Ill. Comp. Stat. 5/15-1603(b)(4).)
The redemption period can also be shortened if:
Under these circumstances, the redemption period will be reduced to 60 days after the foreclosure judgment date, or the expiration of any reinstatement period, whichever is later.
The procedures for redeeming the home in Illinois are complicated—you'll have to give a written notice of intent to redeem to the lender's attorney that meets specific requirements, file a certification with the court, and you'll have to meet certain deadlines. You should talk to a local foreclosure attorney to find out the exact procedures you must follow.
In most cases if you want to keep your home, it is better to take action before the redemption period. This will give you more options to save the property. For example, you could pay off the past-due amounts to reinstate (catch up on) the loan. Illinois law says that the borrower may reinstate the loan up to 90 days after the borrower has been:
Also, the mortgage contract might give you a certain amount of time to reinstate. Also, as a practical matter, many lenders allow the borrower to reinstate at any time prior to the sale. To find out if you can reinstate the loan and the deadline to do so, call your loan servicer.
Foreclosures in Illinois take a long time to complete so you should have sufficient time to explore alternatives to foreclosure before the sale. (Learn more in Nolo’s article States With Long Foreclosure Timelines.)
To find the statutes that discuss your right to redeem the home in Illinois, go to Chapter 735 (Code of Civil Procedure), Article XV, of the Illinois Compiled Statutes.