Legislation to Avoid Delays in Foreclosure Sales Heads to Governor's Desk
HB 5055, as amended, has recently passed both houses and has been sent to Governor Quinn to be signed into law. HB 5055 gives plaintiffs in a mortgage foreclosure action the right to choose the person who will conduct the foreclosure sale. This person shall be either a sheriff, judge, or anyone who has ever been appointed to conduct sales in the past. This means judges can no longer require the local sheriff to act as selling officer for the foreclosed property.
The driving force behind parts of HB 5055 is the massive delay some counties are experiencing because courts are refusing to appoint selling officers and are requiring that sheriffs conduct all sales. Many sheriffs’ offices have not increased their staffing to accommodate the increase in foreclosure sales, which has caused a several month waiting period before sales can be conducted. For example, it is not uncommon in Kane County for sales to be delayed for six months or more because the Kane County Sheriff does not have staff in place to handle the high volume of sales, and the judges in Kane County refuse to allow anyone other than the Kane County Sheriff to conduct the sales. Once this new legislation is signed by the Governor, it will give banks and other mortgagees the right to choose a selling officer other than the sheriff if desired, enabling sales to occur quickly.
Michael Cortina, a partner in SmithAmundsen's Financial Services Practice Group, aided in drafting a portion of this legislation. After encountering several unnecessary delays in the foreclosure process, Mike decided to research ways to require judges to allow selling officers to be appointed to conduct sales if the local county sheriff does not have sufficient capacity. Mike discovered that legislation was pending regarding this same issue. He was contacted by the author of the legislation to provide advice on how to word the legislation. Once signed into law by the Governor, banks will be able to avoid delays in getting foreclosed properties sold, and get non-performing loans off the books sooner.
Additional changes have been made to the Illinois Mortgage Foreclosure Law under HB 5055 relating to notices that must be sent to municipalities and insurance companies whenever a foreclosure sale occurs. For additional information on HB 5055, please feel free to contact Mike Cortina at 815.337.5010 or mcortina@salawus.com
Please click here to access the Illinois General Assembly's Web site if you wish to view the legislation in its entirety.