HB0838eng 95TH GENERAL ASSEMBLY

HB0838 Engrossed LRB095 08932 AJO 29121 b

AN ACT concerning civil law.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Code of Civil Procedure is amended by changing Section 15-1510 and by adding Sections 15-1504.5 and 15-1505.5 as follows:

(735 ILCS 5/15-1504.5 new)

Sec. 15-1504.5. Homeowner notice to be attached to summons. For all residential foreclosure actions filed, the plaintiff must attach a Homeowner Notice to the summons. The Homeowner Notice must be in at least 12 point type and in English and Spanish. The Spanish translation shall be prepared by the Attorney General and posted on the Attorney General's website. A notice that includes the Attorney General's Spanish translation in substantially similar form shall be deemed to comply with the Spanish notice requirement in this Section. The Notice must be in substantially the following form:

IMPORTANT INFORMATION FOR HOMEOWNERS IN FORECLOSURE

1. POSSESSION: The lawful occupants of a home have the right to live in the home until a judge enters an order for possession.

2. OWNERSHIP: You continue to own your home until the court rules otherwise.

3. REINSTATEMENT: As the homeowner you have the right to bring the mortgage current within 90 days after you receive the summons.

4. REDEMPTION: As the homeowner you have the right to sell your home, refinance, or pay off the loan during the redemption period.

5. SURPLUS: As the homeowner you have the right to petition the court for any excess money that results from a foreclosure sale of your home.

6. WORKOUT OPTIONS: The mortgage company does not want to foreclose on your home if there is any way to avoid it. Call your mortgage company [insert name of the homeowner's current mortgage servicer in bold and 14 point type] or its attorneys to find out the alternatives to foreclosure.

7. PAYOFF AMOUNT: You have the right to obtain a written statement of the amount necessary to pay off your loan. Your mortgage company (identified above) must provide you this statement within 10 business days of receiving your request, provided that your request is in writing and includes your name, the address of the property, and the mortgage account or loan number. Your first payoff statement will be free.

8. GET ADVICE: This information is not exhaustive and does not replace the advice of a professional. You may have other options. Get professional advice from a lawyer or certified housing counselor about your rights and options to avoid foreclosure.

9. LAWYER: If you do not have a lawyer, you may be able to find assistance by contacting the Illinois State Bar Association or a legal aid organization that provides free legal assistance.

10. PROCEED WITH CAUTION: You may be contacted by people offering to help you avoid foreclosure. Before entering into any transaction with persons offering to help you, please contact a lawyer, government official, or housing counselor for advice.

(735 ILCS 5/15-1505.5 new)

Sec. 15-1505.5. Payoff demands.

(a) In a foreclosure action subject to this Article, on the written demand of a mortgagor or the mortgagor's authorized agent (which shall include the mortgagor's name, the mortgaged property's address, and the mortgage account or loan number), a mortgagee or the mortgagee's authorized agent shall prepare and deliver an accurate statement of the total outstanding balance of the mortgagor's obligation that would be required to satisfy the obligation in full as of the date of preparation ("payoff demand statement") to the mortgagor or the mortgagor's authorized agent who has requested it within 10 business days after receipt of the demand. For purposes of this Section, a payoff demand statement is accurate if prepared in good faith based on the records of the mortgagee or the mortgagee's agent.

(b) The payoff demand statement shall include the following:

(1) The information necessary to calculate the payoff amount on a per diem basis for the lesser of a period of 30 days or until the date scheduled for judicial sale;

(2) Estimated charges (stated as such) that the mortgagee reasonably believes may be incurred within 30 days from the date of preparation of the payoff demand statement; and

(3) The loan number for the obligation to be paid, the address of the mortgagee, the telephone number of the mortgagee and, if a banking organization or corporation, the name of the department, if applicable, and its telephone number and facsimile phone number.

(c) A mortgagee or mortgagee's agent who willfully fails to prepare and deliver an accurate payoff demand statement within 10 business days after receipt of a written demand is liable to the mortgagor for actual damages sustained for failure to deliver the statement. The mortgagee or mortgagee's agent is liable to the mortgagor for $500 if no actual damages are sustained. For purposes of this subsection, "willfully" means a failure to comply with this Section without just cause or excuse or mitigating circumstances.

(d) The mortgagor must petition the judge within the foreclosure action for the award of any damages pursuant to this Section, which award shall be determined by the judge.

(e) Unless the payoff demand statement provides otherwise, the statement is deemed to apply only to the unpaid balance of the single obligation that is named in the demand and that is secured by the mortgage or deed of trust identified in the payoff demand statement.

(f) The demand for and preparation and delivery of a payoff demand statement pursuant to this Section does not change any date or time period that is prescribed in the note or that is otherwise provided by law. Failure to comply with any provision of this Section does not change any of the rights of the parties as set forth in the note, mortgage, or applicable law.

(g) The mortgagee or mortgagee's agent shall furnish the first payoff demand statement at no cost to the mortgagor.

(h) For the purposes of this Section, unless the context otherwise requires, "deliver" or "delivery" means depositing or causing to be deposited into the United States mail an envelope with postage prepaid that contains a copy of the documents to be delivered and that is addressed to the person whose name and address are provided in the payoff demand. "Delivery" may also include transmitting those documents by telephone facsimile to the person or electronically if the payoff demand specifically requests and authorizes that the documents be transmitted in electronic form.

(i) The mortgagee or mortgagee's agent is not required to comply with the payoff demand statement procedure set forth in this Section when responding to a notice of intent to redeem issued under Section 15-1603(e).

(735 ILCS 5/15-1510) (from Ch. 110, par. 15-1510)

Sec. 15-1510. Attorney's Fees and Costs by Written Agreement.

(a) The court may award reasonable attorney's fees and costs to the defendant who prevails in a motion, an affirmative defense or counterclaim, or in the foreclosure action. A defendant who exercises the defendant's right of reinstatement or redemption shall not be considered a prevailing party for purposes of this Section. Nothing in this subsection shall abrogate contractual terms in the mortgage or other written agreement between the mortgagor and the mortgagee or rights as otherwise provided in this Article which allow the mortgagee to recover attorney's fees and costs under subsection (b).

(b) Attorneys' fees and other costs incurred in connection with the preparation, filing or prosecution of the foreclosure suit shall be recoverable in a foreclosure only to the extent specifically set forth in the mortgage or other written agreement between the mortgagor and the mortgagee or as otherwise provided in this Article.

(Source: P.A. 86-974.)

Section 99. Effective date. This Act takes effect January 1, 2009.