Foreclosure on a Condominium in Chicago

The process for a mortgage lender to foreclose on a condominium, townhouse, or other type of planned unit development or multifamily unit is the same as for foreclosure on a single-family residence. The process is closely regulated in the state of Illinois, which requires a lender to provide the borrower with written notice of the lender’s intent to foreclose, and the date, time and location of the foreclosure sale.

The condo foreclosure process begins anytime after the condo owner defaults on the mortgage loan. Each mortgage contract defines the term “default” a little differently, but in general default means the borrower is at least 30 or 60 days late on one or more monthly mortgage payments.

The first formal step in the foreclosure process occurs when the lender sends the borrower a notice of default and election to sell.

The notice of default is a formal legal document that notifies the borrower that he or she is in default and that the lender intends to foreclose on and sell the condo to satisfy the unpaid balance on the mortgage loan. The notice of default triggers a 90-day redemption period, during which time the borrower can stop the foreclosure by bringing the mortgage current.

The Impact of Not Paying Condo Association Fees

Not paying association fees can result in foreclosure and complicate other issues pertaining to your situation. If you must miss a payment due to your financial limitations, it is crucial not to miss your association fee payments. There are defenses available but it is extremely complex; it is much easier to pay the fees at the time rather than invest in the necessary defense work to rectify the situation at a later date.

One option that may be available to you is to turn your condominium over to the association. Any rent they are able to accrue will be applied toward your balance.