Lenders, Lawyers Could Challenge Chicago Foreclosure Law

A number of lending institutions and associations have filed protests against the Chicago City Council amendment to the municipal code that changed the definition of mortgagee to consider the lender as an owner of the property, and thus liable to maintain the property. The law passed on July 28, 2011, and supported by Mayor Rahm Emanuel will take effect on September 18, 2011, requiring lenders to take over and maintain vacant, attended residential and commercial properties.

According to GlobeSt.com, organizations such as the Securities Industry and Financial Markets Association and American Securitization Forum believe the new law goes against existing property law. Daniel Slattery, a Chicago-based partner at Pittsburgh-based Reed Smith, told the website that "foreclosure of any property is only an option, not a legal requirement by lenders ... A lender could decide to hold its lien and never act, and still not legally own the property."

Who knows how long the political theater over this issue might be stretched out for, but continuing the debate is not much help to the many Chicagoans who need foreclosure help now. Whether a job loss or unforeseen medical bills have you struggling through hard times, our bankruptcy law firm can help you eliminate bills and stop foreclosure. Completing a bankruptcy means test today can go a long way toward ending creditor harassment tomorrow. Contact our office now to set up a free initial consultation with one of our Chicago bankruptcy lawyers.

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