Legal Question in Real Estate Law in Illinois

Assuming you cannot pay the full default through some source and that the lender is not willing to work with you to provide an opportunity to catch up (such as making a payment and a half each month or moving missed payments to the back of the loan), you may want to explore using Chapter 13 to reinstate the mortgage. If your income is sufficient to meet your normal living expenses, including the current mortgage payments, and there is some money left over, you may be able to extend out several years to get caught up. The amount needed each month will depend on numerous factors. For example, you may benefit from a car payment being incorporated into the plan as well. The amounts at issue would need to be considered by a qualified attorney.

The scope of this space does not afford an opportunity to assess the situation and advise you. I recommend you assemble for legal consultation: (1) your income information for May 2011 through the present, including wages and unemployment during that period; (2) all your bills (three months� copies neatly assembled); (3) last four years� tax returns; (4) a credit report (use www.annualcreditreport.com to obtain free report if not requested in last year); and (5) other information that may apply, such as copies of lawsuits. Call a local attorney at your earliest convenience to afford the most opportunity in which to be advised about your best course.

I do not recommend filing bankruptcy on your own. There are too many complex issues. I have seen several posts on this site for debtors who filed on their own and are seeking counsel concerning complications. Most of them will have a hard time finding an attorney to get involved to unwind the mess without the attorney charging several times what would originally have been paid.

Mr. Repay has made many important points; the most important one is to get an attorney involved now. You can assume the lender has already reported your missing/late payments to the credit reporting companies (TransUnion...) so your credit rating is most likely already compromised. You can assume that the rejection of your payment is a prelude to a foreclosure which you could simply await, or you can take it as an opportunity to make a good offense. One thing that may be very good is that you seem to know when you'll be able to come current; normally borrowers in foreclosure have 90 days to bring things up to date. Unless the lender is hell-bent on filing before the end of the year, it sounds like there is a good chance you will be able to bring things current during that 90 day window in a worst case scenario. But do take your information to an attorney at your earliest opportunity.