101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB2539

 

Introduced 1/28/2020, by Sen. Michael E. Hastings

 

SYNOPSIS AS INTRODUCED:
 
735 ILCS 5/15-1508  from Ch. 110, par. 15-1508

    Amends the Mortgage Foreclosure Article of the Code of Civil Procedure. Provides that the order confirming the sale of property may approve the mortgagee's fees and costs incurred prior to the judgment, but not included in the judgment, of foreclosure. Effective January 1, 2021.


LRB101 17257 LNS 66661 b

 

 

A BILL FOR

 

SB2539LRB101 17257 LNS 66661 b

1    AN ACT concerning civil law.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Code of Civil Procedure is amended by
5changing Section 15-1508 as follows:
 
6    (735 ILCS 5/15-1508)  (from Ch. 110, par. 15-1508)
7    Sec. 15-1508. Report of sale and confirmation of sale.
8    (a) Report. The person conducting the sale shall promptly
9make a report to the court, which report shall include a copy
10of all receipts and, if any, certificate of sale.
11    (b) Hearing. Upon motion and notice in accordance with
12court rules applicable to motions generally, which motion shall
13not be made prior to sale, the court shall conduct a hearing to
14confirm the sale. Unless the court finds that (i) a notice
15required in accordance with subsection (c) of Section 15-1507
16was not given, (ii) the terms of sale were unconscionable,
17(iii) the sale was conducted fraudulently, or (iv) justice was
18otherwise not done, the court shall then enter an order
19confirming the sale. The confirmation order shall include a
20name, address, and telephone number of the holder of the
21certificate of sale or deed issued pursuant to that certificate
22or, if no certificate or deed was issued, the purchaser, whom a
23municipality or county may contact with concerns about the real

 

 

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1estate. The confirmation order may also:
2        (1) approve the mortgagee's fees and costs arising
3    between the entry of the judgment of foreclosure and the
4    confirmation hearing, or incurred prior to the judgment but
5    not included in the judgment, those costs and fees to be
6    allowable to the same extent as provided in the note and
7    mortgage and in Section 15-1504;
8        (2) provide for a personal judgment against any party
9    for a deficiency; and
10        (3) determine the priority of the judgments of parties
11    who deferred proving the priority pursuant to subsection
12    (h) of Section 15-1506, but the court shall not defer
13    confirming the sale pending the determination of such
14    priority.
15    (b-3) Hearing to confirm sale of abandoned residential
16property. Upon motion and notice by first-class mail to the
17last known address of the mortgagor, which motion shall be made
18prior to the sale and heard by the court at the earliest
19practicable time after conclusion of the sale, and upon the
20posting at the property address of the notice required by
21paragraph (2) of subsection (l) of Section 15-1505.8, the court
22shall enter an order confirming the sale of the abandoned
23residential property, unless the court finds that a reason set
24forth in items (i) through (iv) of subsection (b) of this
25Section exists for not approving the sale, or an order is
26entered pursuant to subsection (h) of Section 15-1505.8. The

 

 

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1confirmation order also may address the matters identified in
2items (1) through (3) of subsection (b) of this Section. The
3notice required under subsection (b-5) of this Section shall
4not be required.
5    (b-5) Notice with respect to residential real estate. With
6respect to residential real estate, the notice required under
7subsection (b) of this Section shall be sent to the mortgagor
8even if the mortgagor has previously been held in default. In
9the event the mortgagor has filed an appearance, the notice
10shall be sent to the address indicated on the appearance. In
11all other cases, the notice shall be sent to the mortgagor at
12the common address of the foreclosed property. The notice shall
13be sent by first class mail. Unless the right to possession has
14been previously terminated by the court, the notice shall
15include the following language in 12-point boldface
16capitalized type:
17
IF YOU ARE THE MORTGAGOR (HOMEOWNER), YOU HAVE THE RIGHT TO
18
REMAIN IN POSSESSION FOR 30 DAYS AFTER ENTRY OF AN ORDER OF
19
POSSESSION, IN ACCORDANCE WITH SECTION 15-1701(c) OF THE
20
ILLINOIS MORTGAGE FORECLOSURE LAW.
21    (b-10) Notice of confirmation order sent to municipality or
22county. A copy of the confirmation order required under
23subsection (b) shall be sent to the municipality in which the
24foreclosed property is located, or to the county within the
25boundary of which the foreclosed property is located if the
26foreclosed property is located in an unincorporated territory.

 

 

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1A municipality or county must clearly publish on its website a
2single address to which a copy of the order shall be sent. If a
3municipality or county does not maintain a website, then the
4municipality or county must publicly post in its main office a
5single address to which a copy of the order shall be sent. In
6the event that a municipality or county has not complied with
7the publication requirement in this subsection (b-10), then a
8copy of the order shall be sent by first class mail, postage
9prepaid, to the chairperson of the county board or county clerk
10in the case of a county, to the mayor or city clerk in the case
11of a city, to the president of the board of trustees or village
12clerk in the case of a village, or to the president or town
13clerk in the case of a town.
14    (b-15) Notice of confirmation order sent to known insurers.
15With respect to residential real estate, the party filing the
16complaint shall send a copy of the confirmation order required
17under subsection (b) by first class mail, postage prepaid, to
18the last known property insurer of the foreclosed property.
19Failure to send or receive a copy of the order shall not impair
20or abrogate in any way the rights of the mortgagee or purchaser
21or affect the status of the foreclosure proceedings.
22    (c) Failure to Give Notice. If any sale is held without
23compliance with subsection (c) of Section 15-1507 of this
24Article, any party entitled to the notice provided for in
25paragraph (3) of that subsection (c) who was not so notified
26may, by motion supported by affidavit made prior to

 

 

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1confirmation of such sale, ask the court which entered the
2judgment to set aside the sale. Any such party shall guarantee
3or secure by bond a bid equal to the successful bid at the
4prior sale, unless the party seeking to set aside the sale is
5the mortgagor, the real estate sold at the sale is residential
6real estate, and the mortgagor occupies the residential real
7estate at the time the motion is filed. In that event, no
8guarantee or bond shall be required of the mortgagor. Any
9subsequent sale is subject to the same notice requirement as
10the original sale.
11    (d) Validity of Sale. Except as provided in subsection (c)
12of Section 15-1508, no sale under this Article shall be held
13invalid or be set aside because of any defect in the notice
14thereof or in the publication of the same, or in the
15proceedings of the officer conducting the sale, except upon
16good cause shown in a hearing pursuant to subsection (b) of
17Section 15-1508. At any time after a sale has occurred, any
18party entitled to notice under paragraph (3) of subsection (c)
19of Section 15-1507 may recover from the mortgagee any damages
20caused by the mortgagee's failure to comply with such paragraph
21(3). Any party who recovers damages in a judicial proceeding
22brought under this subsection may also recover from the
23mortgagee the reasonable expenses of litigation, including
24reasonable attorney's fees.
25    (d-5) Making Home Affordable Program. The court that
26entered the judgment shall set aside a sale held pursuant to

 

 

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1Section 15-1507, upon motion of the mortgagor at any time prior
2to the confirmation of the sale, if the mortgagor proves by a
3preponderance of the evidence that (i) the mortgagor has
4applied for assistance under the Making Home Affordable Program
5established by the United States Department of the Treasury
6pursuant to the Emergency Economic Stabilization Act of 2008,
7as amended by the American Recovery and Reinvestment Act of
82009, and (ii) the mortgaged real estate was sold in material
9violation of the program's requirements for proceeding to a
10judicial sale. The provisions of this subsection (d-5) are
11operative and, except for this sentence, shall become
12inoperative on January 1, 2018 for all actions filed under this
13Article after December 31, 2017, in which the mortgagor did not
14apply for assistance under the Making Home Affordable Program
15on or before December 31, 2016. The changes to this subsection
16(d-5) by this amendatory Act of the 99th General Assembly apply
17to all cases pending and filed on or after the effective date
18of this amendatory Act of the 99th General Assembly.
19    (e) Deficiency Judgment. In any order confirming a sale
20pursuant to the judgment of foreclosure, the court shall also
21enter a personal judgment for deficiency against any party (i)
22if otherwise authorized and (ii) to the extent requested in the
23complaint and proven upon presentation of the report of sale in
24accordance with Section 15-1508. Except as otherwise provided
25in this Article, a judgment may be entered for any balance of
26money that may be found due to the plaintiff, over and above

 

 

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1the proceeds of the sale or sales, and enforcement may be had
2for the collection of such balance, the same as when the
3judgment is solely for the payment of money. Such judgment may
4be entered, or enforcement had, only in cases where personal
5service has been had upon the persons personally liable for the
6mortgage indebtedness, unless they have entered their
7appearance in the foreclosure action.
8    (f) Satisfaction. Upon confirmation of the sale, the
9judgment stands satisfied to the extent of the sale price less
10expenses and costs. If the order confirming the sale includes a
11deficiency judgment, the judgment shall become a lien in the
12manner of any other judgment for the payment of money.
13    (g) The order confirming the sale shall include,
14notwithstanding any previous orders awarding possession during
15the pendency of the foreclosure, an award to the purchaser of
16possession of the mortgaged real estate, as of the date 30 days
17after the entry of the order, against the parties to the
18foreclosure whose interests have been terminated.
19    An eviction order authorizing the removal of a person from
20possession of the mortgaged real estate shall be entered and
21enforced only against those persons personally named as
22individuals in the complaint or the petition under subsection
23(h) of Section 15-1701. No eviction order issued under this
24Section shall be entered against a lessee with a bona fide
25lease of a dwelling unit in residential real estate in
26foreclosure, whether or not the lessee has been made a party in

 

 

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1the foreclosure. An order shall not be entered and enforced
2against any person who is only generically described as an
3unknown owner or nonrecord claimant or by another generic
4designation in the complaint.
5    Notwithstanding the preceding paragraph, the failure to
6personally name, include, or seek an eviction order against a
7person in the confirmation order shall not abrogate any right
8that the purchaser may have to possession of the mortgaged real
9estate and to maintain an eviction proceeding under Article IX
10of this Code or, if applicable, under subsection (h) of Section
1115-1701; and eviction of a person who (1) has not been
12personally named as a party to the foreclosure and (2) has not
13been provided an opportunity to be heard in the foreclosure
14proceeding may be sought only by maintaining a proceeding under
15Article IX of this Code or, if applicable, under subsection (h)
16of Section 15-1701.
17    (h) With respect to mortgaged real estate containing 5 or
18more dwelling units, the order confirming the sale shall also
19provide that (i) the mortgagor shall transfer to the purchaser
20the security deposits, if any, that the mortgagor received to
21secure payment of rent or to compensate for damage to the
22mortgaged real estate from any current occupant of a dwelling
23unit of the mortgaged real estate, as well as any statutory
24interest that has not been paid to the occupant, and (ii) the
25mortgagor shall provide an accounting of the security deposits
26that are transferred, including the name and address of each

 

 

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1occupant for whom the mortgagor holds the deposit and the
2amount of the deposit and any statutory interest.
3(Source: P.A. 99-640, eff. 7-28-16; 100-173, eff. 1-1-18.)
 
4    Section 99. Effective date. This Act takes effect January
51, 2021.