New Law Tries to Curtail Preditory Lenders From Destroying Neighborhoods
“This is a day we’re going to commit ourselves to straightening out a major problem,” Illinois Governor Pat Quinn said before signing a law that prevents lenders from forcing homeowners out of their homes for an additional 90 days. Quinn was joined by Illinois House Speaker Michael Madigan (D-Chicago) who said, “This is really a continuing struggle,” Madigan said. “A continuing battle against people who don’t care about neighborhoods. Their only concern is to make money.” Madigan then added, “Let the word go out to predatory lenders: don’t come back.”
What Does the New Law Do?
The new law forces lenders to work with homeowners for a longer time than they were required to provide before the law. The new law probits foreclosures during the first 30 days of a homeowner being delinquent with their payments. Lenders are now required to tell homeowners that they have an additional 30 days to work with a credit counselor. And, if the credit counselor is approved by the U.S. Department of Housing and Urban Development, the homeowner is given an additional 30 days, totaling 90 days.
90 Days Can Mean the Chance to Find a New Job
The Chicago Tribune quotes Jeff Bartow as saying, “It’s the difference between a job lost and a job found.” Mr. Bartow is executive director of the Southwest Organizing Project, which is a non-profit community group working to solve the foreclosure problem by working with both lawmakers and residents.
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April 8, 2009 at 2:21 pm
Well, I think the law is well intented, but unless I am understanding it wrong, or it wasn’t printed up in the Trib correctly, it isn’t really accomplishing anything. Lenders never move to foreclose after 30 days. It’s typically 90 to 120 days until they serve a notice of default and file for a judgement of foreclosure. So if the law is “forcing” lenders to wait until 90 or 120 days, it’s not accomplishing anything, because lenders are waiting that long anyhow. Banks and lenders do NOT want to foreclose on properties; they lose money when that happens 99% of the time.