Legislative Updates

The Illinois legislature has amended its laws related to short sales and foreclosures, effective August 16, 2019.  The New York legislature has amended its laws regarding vacant or abandoned property, effective August 14, 2019.

ILLINOIS SENATE BILL 138

The amended law provides that if an offer to purchase either a mortgage or residential property is made by a non-profit entity for the purpose of reselling that mortgage or residential property to the borrower, and financing for the repurchase will be provided by a certified community development financial institution, an affidavit limiting ownership or occupancy of the property by the borrower does not provide a basis to avoid a sale or transfer, nor is it enforceable against the acquiring entity or any borrower or settlement agent named in the affidavit.  In such cases, the following must be disclosed:

• The entity seeking to purchase is a non-profit entity;
• The entity that will finance the sale following the purchase is a certified community development financial institution; and
• The property will be sold back to the borrower.

ILLINOIS SENATE BILL 169

The law has been changed to provide that the failure to send a copy of the notice of foreclosure of real estate in a city with a population over 2 million to the alderman of the ward where the property is located, will result in a stay of the foreclosure action upon a motion of a party or the court.  Previously, the failure to meet this requirement could result in the dismissal without prejudice of the complaint on a motion of a party or the court. 

NEW YORK SENATE BILL 4182

Servicers are required to take certain actions to protect property that has been deemed vacant or abandoned.  The law was amended to add a requirement to pay homeowners’ association or cooperative fees as necessary to maintain the vacant or abandoned property.