A controversial move by a county sheriff in Illinois to halt all foreclosure evictions has been resolved. But servicers will have to wait as long as 120 days for non-borrower tenants to move out.
Last week, Cook County Sheriff Thomas J. Dart issued a statement indicating he was suspending all foreclosure evictions. He said he made the move because innocent tenants who had been making their rental payments were being evicted without the lenders having done any due diligence to determine who occupied the properties.
Cook County includes the City of Chicago -- the third biggest U.S. city.
A lawsuit subsequently filed by Accredited Home Lenders that sought to force the sheriff to evict a former borrower from her foreclosed home was quickly dropped.
Yesterday, Dart announced that the mortgage eviction process had been overhauled. After discussions between the sheriff and members of the Cook County Circuit Court's Chancery Division, Dart said Chancery Court Judge Dorothy Kirie Kinnaird is ordering several steps be added to the mortgage foreclosure filing process.
"Many of those banks did not account for renters who may have moved in after the foreclosure action had started and or before the eviction order was actually entered," the statement said. "Many of those tenants dutifully paid rent, leading to great surprise when deputies came to their front doors with an eviction order."
Dart noted that 24 of the 61 mortgage foreclosure evictions requested by lenders over the past week were on properties where someone other than the person listed on the eviction order lived.
While foreclosure evictions will be resumed, mortgage servicers must now provide a detailed description of the building and the name of all occupants at the time of the initial foreclosure filing. They must also provide the date that they physically inspected the property and proof that all occupants have been served with a foreclosure notice.
In addition, servicers must prove that tenants have been informed of a 120-day grace period granted to them by state law that allows them to secure new housing before moving out.
"Those steps not only protect tenants, but also taxpayers, who will no longer foot the bill for conducting due diligence investigations for the banks," the announcement said.
The sheriff said a social worker will be hired to help evicted tenants find alternative housing. Also, mortgage fraud investigations will be stepped up.
He said an estimated 4,500 foreclosure evictions will be conducted this year, up from 1,771 two years ago.
"Make no mistake -- should our deputies again identify patterns of abuse happening, we will bring it to the attention of the judiciary and won't hesitate to halt evictions if necessary," Dart warned.
Lawsuit Dropped Against Illinois Sheriff
Accredited Home Lenders is backing away from a lawsuit against an Illinois sheriff that is refusing to perform evictions on foreclosed properties.