Facing foreclosure—what you need to know

Layoffs. Illness. There are a number of reasons a person may be facing foreclosure. It’s daunting, unsettling and downright scary.

But there are two important things you must do if you find yourself in that position, according to Olivia Dirig, an attorney with Franks Gerkin McKenna, in Marengo.

“Take a hard look at what you can actually afford, and be proactive,” Dirig said. “Whether it’s selling your home, catching up on payments or working on a modification, make a decision and work the plan.”

“Because foreclosure takes almost a year it’s foolish to wait until the end,” Dirig said.

“Call an attorney when you get served, not after you’ve been to court two or three times,” Dirig said. “The people who do best are the people who recognize that it’s coming, make decisions about what they want to do and take steps to put that in motion.”

It’s easier to get a loan modification or get on a repayment plan if you’re only a few months behind.

“A lot of people who can afford a repayment plan when they’re behind 6 months can’t afford it when they’re 18 months behind,” said Dirig.

A common misconception is that the court has the power to order a loan modification. In Illinois it doesn’t.

“All that needs to occur is negotiations directly with the bank or their attorney,” Dirig said. “Modification is an out-of-court settlement in a foreclosure.”

However, Dirig recommends having an attorney help through the process.

“You have an attorney at your closing. When you modify your mortgage you should have somebody helping you too,” she said.

A good alternative to a foreclosure is a short sale, when you sell your home for less than you owe on the mortgage, Dirig said, adding, “For that I recommend finding a good attorney and a good realtor.”

Call today. Franks, Gerkin & McKenna | (815) 923-2107 | 19333 East Grant Highway Marengo, Illinois 60152