COVID-19 – Foreclosures

If you are unable to pay your mortgage as a result of the Covid-19 crisis, you should contact your mortgage lender immediately.  Most mortgage lenders are working with homeowners to help you retain your property.  However, you MUST contact your lender.  Programs that are available are not automatic and will likely require you to complete an application.

In Cook County, there is a moratorium of foreclosure cases.  The following is a summary of how the Covid-19 crisis has affected foreclosure cases in Cook County.

Foreclosure Moratorium on Residential Real Property

  • “federally backed mortgage loan” includes any loan secured by a first or subordinate lien on residential real property (including condominiums and cooperatives)
  • on 1-to 4-unit buildings
  • which are either insured or guaranteed under FHA, VA, and certain other programs
  • or which are purchased or securitized by FHLMC or FNMA.
  • Allows borrower to request forbearance on a federally backed mortgage loan for up to 180 days which shall be extended for an additional 180 days at borrower’s request,     subject to borrower’s request to shorten the period.
  • All borrower needs to do is submit a request to the servicer affirming that borrower is experiencing a financial hardship during the COVID-19 emergency.
  • Makes no difference if borrower was delinquent at the time of the request.
  • during forbearance period, no fees, penalties, or interest shall accrue (beyond the amounts calculated as if payments were made on time)
  • servicer cannot initiate any foreclosure, move for a foreclosure judgment, or execute a foreclosure-related eviction or foreclosure sale for not less than the 60-day period       beginning March 18, 2020 (except for vacant or abandoned property)
  • Remember it’s a moratorium, not a forgiveness.

Foreclosure Moratorium on Multifamily Properties

  • borrower with a federally backed multifamily mortgage loan that was current as of February 1, 2020 may submit an oral or written request for forbearance to the servicer affirming that borrower is experiencing financial hardship during the COVID-19 emergency.
  • the servicer shall provide forbearance for up to 30 days which shall be extended for two additional 30-day periods if borrower makes request at least 15 days prior to end of     forbearance period.
  • Borrower can discontinue forbearance at any time.
  • servicer needs to document the financial hardship.
  • a borrower that receives a forbearance may not evict or initiate an eviction located on the property solely for the nonpayment of rent or other fees or charges.
  • or charge any late fees, penalties, or other charges to the tenant.
  • cannot issue a notice to vacate until forbearance period expires.
  • Date to vacate cannot be prior to 30 days after notice is provided.

Gregory K. Stern, P.C. has Chapter 13 bankruptcy attorneys and Chapter 11 bankruptcy attorneys available to discuss your options in stopping foreclosures in Chicago and the surrounding suburbs.