Full Text of HB3863 96th General Assembly
HB3863enr 96TH GENERAL ASSEMBLY
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| AN ACT concerning civil law.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Code of Civil Procedure is amended by | 5 |
| changing Sections 15-1701, 15-1703, and 15-1704 and by adding | 6 |
| Sections 15-1202.5 and 15-1508.5 as follows: | 7 |
| (735 ILCS 5/15-1202.5 new)
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| Sec. 15-1202.5. Dwelling unit. For the purposes of Sections | 9 |
| 15-1508.5, 15-1703, and 15-1704 only, "dwelling unit" means a | 10 |
| room or suite of rooms providing complete, independent living | 11 |
| facilities for at least one person, including permanent | 12 |
| provisions for sanitation, cooking, eating, sleeping, and | 13 |
| other activities routinely associated with daily life. | 14 |
| (735 ILCS 5/15-1508.5 new) | 15 |
| Sec. 15-1508.5. Notice by holder or purchaser to known | 16 |
| occupants of dwelling units of mortgaged real estate. | 17 |
| (a) The holder of the certificate of sale or deed issued | 18 |
| pursuant to that certificate or, if no certificate or deed was | 19 |
| issued, the purchaser, shall: | 20 |
| (1) following the judicial sale under Section 15-1507, | 21 |
| but no later than 21 days after the confirmation of sale | 22 |
| under Section 15-1508, make a good faith effort to |
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| ascertain the identities and addresses of all occupants of | 2 |
| dwelling units of the mortgaged real estate; and | 3 |
| (2) following the order confirming sale under Section | 4 |
| 15-1508, but no later than 21 days after the order | 5 |
| confirming sale, notify all known occupants of dwelling | 6 |
| units of the mortgaged real estate that the holder or | 7 |
| purchaser has acquired the mortgaged real estate. The | 8 |
| notice shall be in writing and shall: | 9 |
| (i) identify the occupant being served by the name | 10 |
| known to the holder or purchaser; | 11 |
| (ii) inform the occupant that the mortgaged real | 12 |
| estate at which the dwelling unit is located is the | 13 |
| subject of a foreclosure and that control of the | 14 |
| mortgaged real estate has changed; | 15 |
| (iii) provide the name, address, and telephone | 16 |
| number of an individual or entity whom the occupants | 17 |
| may contact with concerns about the mortgaged real | 18 |
| estate or to request repairs of that property; | 19 |
| (iv) include the following language, or language | 20 |
| that is substantially similar:
"This is NOT a notice to | 21 |
| vacate the premises. You may wish to contact a lawyer | 22 |
| or your local legal aid or housing counseling agency to | 23 |
| discuss any rights that you may have."; and | 24 |
| (v) include the name of the case, the case number, | 25 |
| and the court where the order confirming the sale has | 26 |
| been entered. |
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| (b) The written notice required by subsection (a) of this | 2 |
| Section shall be served by delivering a copy thereof to the | 3 |
| known occupant, or by leaving the same with some person of the | 4 |
| age of 13 years or upwards who is residing on or in possession | 5 |
| of the premises, or by sending a copy of the notice to the | 6 |
| known occupant by first-class mail, addressed to the occupant | 7 |
| by the name known to the holder or purchaser. | 8 |
| (c) In the event that the holder or purchaser ascertains | 9 |
| the identity and address of an occupant of a dwelling unit of | 10 |
| the mortgaged real estate more than 21 days after the | 11 |
| confirmation of sale under Section 15-1508, the holder or | 12 |
| purchaser shall provide the notice required by subparagraph (2) | 13 |
| of subsection (a) within 7 days of ascertaining the identity | 14 |
| and address of the occupant. | 15 |
| (d)(i) A holder or purchaser who fails to comply with | 16 |
| subsections (a), (b), and (c) may not collect any rent due and | 17 |
| owing from a known occupant, or terminate a known occupant's | 18 |
| tenancy for non-payment of such rent, until the holder or | 19 |
| purchaser has served the notice described in paragraph (2) of | 20 |
| subsection (a) of this Section upon the known occupant. After | 21 |
| providing such notice, the holder or purchaser may collect any | 22 |
| and all rent otherwise due and owing the holder or purchaser | 23 |
| from the known occupant and may terminate the known occupant's | 24 |
| tenancy for non-payment of such rent if the holder or purchaser | 25 |
| otherwise has such right to terminate. | 26 |
| (ii) An occupant who previously paid rent for the current |
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| rental period to the mortgagor, or other entity with the | 2 |
| authority to operate, manage, and conserve the mortgaged real | 3 |
| estate at the time of payment, shall not be held liable for | 4 |
| that rent by the holder or purchaser, and the occupant's | 5 |
| tenancy shall not be terminated for non-payment of rent for | 6 |
| that rental period. | 7 |
| (e) Within 21 days of the confirmation of sale under | 8 |
| Section 15-1508, the holder or purchaser shall post a written | 9 |
| notice on the primary entrance of each dwelling unit subject to | 10 |
| the foreclosure action. This notice shall: | 11 |
| (i) inform occupant that the dwelling unit is the | 12 |
| subject of a foreclosure action and that control of the | 13 |
| mortgaged real estate has changed; | 14 |
| (ii) include the following language: "This is NOT a | 15 |
| notice to vacate the premises."; and | 16 |
| (iii) provide the name, address, and telephone number | 17 |
| of the individual or entity whom occupants may contact with | 18 |
| concerns about the mortgaged real estate or to request | 19 |
| repairs of the property. | 20 |
| (f)(i) The provisions of subsection (d) of this Section | 21 |
| shall be the exclusive remedy for the failure of a holder or | 22 |
| purchaser to provide notice to a known occupant under this | 23 |
| Section. | 24 |
| (ii) This Section shall not abrogate any right that a | 25 |
| holder or purchaser may have to possession of the mortgaged | 26 |
| real estate and to maintain a proceeding against an occupant of |
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| a dwelling unit for possession under Article 9 of this Code or | 2 |
| subsection (h) of Section 15-1701. | 3 |
| (iii) In the event that the holder or purchaser is a | 4 |
| mortgagee in possession of the mortgaged real estate pursuant | 5 |
| to Section 15-1703 at the time of the confirmation of sale and | 6 |
| has complied with requirements of subsection (a-5) of Section | 7 |
| 15-1703, the holder or purchaser is excused from the | 8 |
| requirements of subsections (a) and (e) of this Section. | 9 |
| (iv) A holder or purchaser is not required to provide the | 10 |
| notice required by this Section to a mortgagor or party against | 11 |
| whom an order of possession has been entered authorizing the | 12 |
| removal of the mortgagor or party pursuant to subsection (g) of | 13 |
| Section 15-1508.
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| (735 ILCS 5/15-1701) (from Ch. 110, par. 15-1701)
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| Sec. 15-1701. Right to possession.
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| (a) General. The provisions of
this Article shall govern | 17 |
| the right to possession of the mortgaged real
estate during | 18 |
| foreclosure. Possession under this Article includes physical
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| possession of the mortgaged real estate to the same extent to | 20 |
| which the
mortgagor, absent the foreclosure, would have been | 21 |
| entitled to physical
possession. For the purposes of Part 17, | 22 |
| real estate is residential real estate
only if it is | 23 |
| residential real estate at the time the foreclosure is | 24 |
| commenced.
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| (b) Pre-Judgment. Prior to the entry of a judgment of |
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| foreclosure:
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| (1) In the case of residential real estate, the | 3 |
| mortgagor shall be
entitled to possession of the real | 4 |
| estate except if (i) the mortgagee shall
object and show | 5 |
| good cause, (ii) the mortgagee is so authorized by the | 6 |
| terms of
the mortgage or other written instrument, and | 7 |
| (iii) the court is satisfied that
there is a reasonable | 8 |
| probability that the mortgagee will prevail on a final
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| hearing of the cause, the court shall upon request place | 10 |
| the mortgagee in
possession. If the residential real estate | 11 |
| consists of more than one dwelling
unit, then for the | 12 |
| purpose of this Part residential real estate shall mean | 13 |
| only
that dwelling unit or units occupied by persons | 14 |
| described in clauses (i), (ii)
and (iii) of Section | 15 |
| 15-1219.
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| (2) In all other cases, if (i) the mortgagee is so | 17 |
| authorized by the
terms of the mortgage or other written | 18 |
| instrument, and (ii) the court is
satisfied that there is a | 19 |
| reasonable probability that the mortgagee will
prevail on a | 20 |
| final hearing of the cause, the mortgagee shall
upon | 21 |
| request be placed in possession of the real estate, except | 22 |
| that if the
mortgagor shall object and show good cause, the | 23 |
| court shall allow the
mortgagor to remain in possession.
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| (c) Judgment Through 30 Days After Sale Confirmation. After | 25 |
| the entry
of a judgment of foreclosure and through the 30th day | 26 |
| after a foreclosure
sale is confirmed:
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| (1) Subsection (b) of Section 15-1701 shall be | 2 |
| applicable, regardless of
the provisions of the mortgage or | 3 |
| other instrument, except that after a
sale pursuant to the | 4 |
| judgment the holder of the certificate of sale
(or, if | 5 |
| none, the purchaser at the sale) shall have the mortgagee's | 6 |
| right to be
placed in possession, with all rights and | 7 |
| duties of a mortgagee in possession
under this Article.
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| (2) Notwithstanding paragraph (1) of subsection (b) | 9 |
| and paragraph (1) of
subsection (c) of Section 15-1701, | 10 |
| upon request of the mortgagee, a mortgagor
of residential | 11 |
| real estate shall not be allowed to remain in possession | 12 |
| between
the expiration of the redemption period and through | 13 |
| the 30th day after sale
confirmation unless (i) the | 14 |
| mortgagor pays to the mortgagee or such holder or
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| purchaser, whichever is applicable, monthly the lesser of | 16 |
| the interest due
under the mortgage calculated at the | 17 |
| mortgage rate of interest applicable as if
no default had | 18 |
| occurred or the fair rental value of the real estate, or | 19 |
| (ii)
the mortgagor otherwise shows good cause. Any amounts | 20 |
| paid by the mortgagor
pursuant to this subsection shall be | 21 |
| credited against the amounts due from the
mortgagor.
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| (d) After 30 Days After Sale Confirmation. The holder of
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| the certificate of sale or deed issued pursuant to that | 24 |
| certificate or, if
no certificate or deed was issued, the | 25 |
| purchaser, except to the extent the
holder or purchaser may | 26 |
| consent otherwise, shall be entitled to possession of
the |
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| mortgaged real estate, as of the date 30 days after the order | 2 |
| confirming
the sale is entered, against those parties to the | 3 |
| foreclosure whose interests
the court has ordered terminated, | 4 |
| without further notice to any party, further
order of the | 5 |
| court, or resort to proceedings under any other statute other | 6 |
| than
this Article.
This right to possession shall be limited by | 7 |
| the provisions
governing entering and enforcing orders of | 8 |
| possession under subsection (g) of
Section
15-1508.
If the | 9 |
| holder or purchaser determines that there are occupants
of the | 10 |
| mortgaged real estate who have not been made parties to the | 11 |
| foreclosure
and had their interests terminated therein, the | 12 |
| holder or purchaser may bring a
proceeding under subsection (h) | 13 |
| of this Section or under Article 9 of this Code
to terminate | 14 |
| the rights of possession of any such occupants. The holder or
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| purchaser shall not be entitled to proceed against any such | 16 |
| occupant under
Article 9 of this Code until after 30 days after | 17 |
| the order confirming the sale
is entered.
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| (e) Termination of Leases. A lease of all or any part of | 19 |
| the mortgaged
real estate shall not be terminated automatically | 20 |
| solely by virtue of the entry
into possession by (i) a | 21 |
| mortgagee or receiver prior to the entry of an order
confirming | 22 |
| the sale, (ii) the holder of the certificate of sale, (iii) the
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| holder of the deed issued pursuant to that certificate, or (iv) | 24 |
| if no
certificate or deed was issued, the purchaser at the | 25 |
| sale.
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| (f) Other Statutes; Instruments. The provisions of this |
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| Article
providing for possession of mortgaged real estate shall | 2 |
| supersede any other
inconsistent statutory provisions. In | 3 |
| particular, and without limitation,
whenever a receiver is | 4 |
| sought to be appointed in any action in which a
foreclosure is | 5 |
| also pending, a receiver shall be appointed only in
accordance | 6 |
| with this Article. Except as may be authorized by this Article,
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| no mortgage or other instrument may modify or supersede the | 8 |
| provisions of this
Article.
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| (g) Certain Leases. Leases of the mortgaged real estate | 10 |
| entered into by
a mortgagee in possession or a receiver and | 11 |
| approved by the court in a
foreclosure shall be binding on all | 12 |
| parties, including the mortgagor after
redemption, the | 13 |
| purchaser at a sale pursuant to a judgment of foreclosure
and | 14 |
| any person acquiring an interest in the mortgaged real estate | 15 |
| after
entry of a judgment of foreclosure in accordance with | 16 |
| Sections 15-1402 and
15-1403.
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| (h) Proceedings Against Certain Occupants.
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| (1) The mortgagee-in-possession of the mortgaged real | 19 |
| estate under Section
15-1703, a receiver appointed under | 20 |
| Section 15-1704, a holder of the
certificate of sale or | 21 |
| deed, or the purchaser may, at any time during the
pendency | 22 |
| of the foreclosure and up to 90 days after the date of the | 23 |
| order
confirming the sale,
file a supplemental petition for | 24 |
| possession against a person not personally
named as a party
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| to the foreclosure. The supplemental petition for | 26 |
| possession shall name each such
occupant against whom |
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| possession is sought and state the facts upon which the
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| claim for relief is premised.
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| (2) The petitioner shall serve upon each named occupant | 4 |
| the petition,
a notice of hearing on the petition, and, if | 5 |
| any, a copy of the certificate of
sale or deed. The | 6 |
| proceeding for the termination of such occupant's | 7 |
| possessory
interest, including service of the notice of the | 8 |
| hearing and the petition,
shall in all respects comport | 9 |
| with the requirements of Article 9 of this Code,
except as | 10 |
| otherwise specified in this Section. The hearing shall be | 11 |
| no less
than 21 days from the date of service of the | 12 |
| notice.
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| (3) The supplemental petition shall be heard as part of | 14 |
| the foreclosure
proceeding and without the payment of | 15 |
| additional filing fees. An order for
possession obtained | 16 |
| under this Section shall name each occupant whose interest
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| has been terminated, shall recite that it is only effective | 18 |
| as to the occupant
so named and those holding under them, | 19 |
| and shall be enforceable for no more
than 90 days after its | 20 |
| entry, except that the 90-day period may be extended to
the | 21 |
| extent and in the manner provided in Section 9-117 of | 22 |
| Article 9 and except as provided in item (4) of this | 23 |
| subsection (h). | 24 |
| (4) In a case of foreclosure where the occupant tenant | 25 |
| is current on his or her rent, or where timely written | 26 |
| notice of to whom and where the rent is to be paid has not |
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| been provided to the occupant tenant , or where the occupant | 2 |
| tenant has made good-faith efforts to make rental payments | 3 |
| in order to keep current, any order of possession must | 4 |
| allow the occupant tenant to retain possession of the | 5 |
| property covered in his or her rental agreement (i) for 120 | 6 |
| days following the notice of the hearing on the | 7 |
| supplemental petition that has been properly served upon | 8 |
| the occupant tenant , or (ii) through the duration of his or | 9 |
| her lease, whichever is shorter , provided that if the | 10 |
| duration of his or her lease is less than 30 days from the | 11 |
| date of the order, the order shall allow the occupant to | 12 |
| retain possession for 30 days from the date of the order. A | 13 |
| mortgagee in possession, receiver, holder of a certificate | 14 |
| of sale or deed, or purchaser at the judicial sale, who | 15 |
| asserts that the occupant is not current in rent, shall | 16 |
| file an affidavit to that effect in the supplemental | 17 |
| petition proceeding . If the occupant tenant has been given | 18 |
| timely written notice of to whom and where the rent is to | 19 |
| be paid, this item (4) shall only apply if the occupant | 20 |
| tenant continues to pay his or her rent in full during the | 21 |
| 120-day period or has made good-faith efforts to pay the | 22 |
| rent in full during that period.
No | 23 |
| mortgagee-in-possession, receiver or holder of a | 24 |
| certificate of sale or deed, or purchaser who fails to file | 25 |
| a supplemental petition under this subsection during the | 26 |
| pendency of a mortgage foreclosure shall file a forcible |
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| entry and detainer action against an occupant a tenant of | 2 |
| the mortgaged real estate until 90 days after a notice of | 3 |
| intent to file such action has been properly served upon | 4 |
| the occupant tenant . | 5 |
| (5) The court records relating to a supplemental | 6 |
| petition for possession filed under this subsection (h) | 7 |
| against an occupant a tenant who is entitled to notice | 8 |
| under item (4) of this subsection (h), or relating to a | 9 |
| forcible entry and detainer action brought against an | 10 |
| occupant a tenant who would have lawful possession of the | 11 |
| premises but for the foreclosure of a mortgage on the | 12 |
| property, shall be ordered sealed and shall not be | 13 |
| disclosed to any person, other than a law enforcement | 14 |
| officer or any other representative of a governmental | 15 |
| entity, except upon further order of the court.
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| (Source: P.A. 95-262, eff. 1-1-08; 95-933, eff. 8-26-08.)
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| (735 ILCS 5/15-1703) (from Ch. 110, par. 15-1703)
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| Sec. 15-1703. Mortgagee in Possession. (a) Powers and | 19 |
| Duties. A mortgagee
placed in possession of the real estate | 20 |
| pursuant to Section 15-1701 or Section
15-1702 shall have:
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| (1) such power and authority with respect to the real | 22 |
| estate and other
property subject to the mortgage, | 23 |
| including the right to receive the rents,
issues and | 24 |
| profits thereof, as may have been conferred upon the | 25 |
| mortgagee
by the terms of the mortgage or other written |
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| instrument authorizing the
taking of possession;
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| (2) all other rights and privileges of a mortgagee in | 3 |
| possession under
law not inconsistent herewith; and
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| (3) the same powers, duties and liabilities as a | 5 |
| receiver appointed for
the real estate in accordance with | 6 |
| this Article. If an order placing a
mortgagee in possession | 7 |
| is modified, revoked or set aside, the mortgagee
shall not | 8 |
| be liable for any damages to the extent such damages arise
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| solely out of the fact that the mortgagor was removed from | 10 |
| possession or
that the mortgagee was placed in possession.
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| (a-5) Notice to occupants. | 12 |
| (1) Following the order placing the mortgagee in | 13 |
| possession of the mortgaged real estate, but no later than | 14 |
| 21 days after the entry of such order, the mortgagee in | 15 |
| possession shall make a good faith effort to ascertain the | 16 |
| identities and addresses of all occupants of dwelling units | 17 |
| of the mortgaged real estate. | 18 |
| (2) Following the order placing the mortgagee in | 19 |
| possession of the mortgaged real estate, but no later than | 20 |
| 21 days after the entry of such order, the mortgagee in | 21 |
| possession shall notify all known occupants of dwelling | 22 |
| units of the mortgaged real estate that the mortgagee has | 23 |
| taken possession of the mortgaged real estate. The notice | 24 |
| shall be in writing and shall: | 25 |
| (i) identify the occupant being served by the name | 26 |
| known to the mortgagee in possession; |
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| (ii) inform the occupant that the mortgaged real | 2 |
| estate at which the dwelling unit is located is the | 3 |
| subject of a foreclosure action and that control of the | 4 |
| mortgaged real estate has changed; | 5 |
| (iii) provide the name, address, and telephone | 6 |
| number of the individual or entity whom occupants may | 7 |
| contact with concerns about the mortgaged real estate | 8 |
| or to request repairs of that property; | 9 |
| (iv) include the following language, or language | 10 |
| that is substantially similar: "This is NOT a notice to | 11 |
| vacate the premises. You may wish to contact a lawyer | 12 |
| or your local legal aid or housing counseling agency to | 13 |
| discuss any rights that you may have."; and | 14 |
| (v) include the name of the case, the case number, | 15 |
| and the court where the foreclosure action is pending. | 16 |
| (3) The written notice required by item (2) of this | 17 |
| subsection (a-5) shall be served by delivering a copy | 18 |
| thereof to the known occupant, or by leaving the same with | 19 |
| some person of the age of 13 years or upwards, who is | 20 |
| residing on or in possession of the premises; or by sending | 21 |
| a copy of the notice to the known occupant by first-class | 22 |
| mail, addressed to the occupant by the name known to the | 23 |
| mortgagee in possession. | 24 |
| (4) In the event that a mortgagee in possession | 25 |
| ascertains the identity and address of an occupant of a | 26 |
| dwelling unit of the mortgaged real estate more than 21 |
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| days after being placed in possession of the mortgaged real | 2 |
| estate pursuant to Section 15-1703, the mortgagee in | 3 |
| possession shall provide the notice required by item (2) of | 4 |
| this subsection (a-5) within 7 days of ascertaining the | 5 |
| identity and address of the occupant. | 6 |
| (5)(i) A mortgagee in possession who fails to comply | 7 |
| with items (1), (2), (3), and (4) of this subsection (a-5) | 8 |
| may not collect any rent due and owing from a known | 9 |
| occupant, or terminate a known occupant's tenancy for | 10 |
| non-payment of such rent, until the mortgagee in possession | 11 |
| has served the notice described in item (2) of this | 12 |
| subsection (a-5) upon the known occupant. After providing | 13 |
| such notice, the mortgagee in possession may collect any | 14 |
| and all rent otherwise due and owing the mortgagee in | 15 |
| possession from the known occupant and may terminate the | 16 |
| known occupant's tenancy for non-payment of such rent if | 17 |
| the mortgagee in possession otherwise has such right to | 18 |
| terminate. | 19 |
| (ii) An occupant who previously paid rent for the | 20 |
| current rental period to the mortgagor, or other entity | 21 |
| with the authority to operate, manage, and conserve the | 22 |
| mortgaged real estate at the time of payment, shall not be | 23 |
| held liable for that rent by the mortgagee in possession, | 24 |
| and the occupant's tenancy shall not be terminated for | 25 |
| non-payment of rent for that rental period. | 26 |
| (6) Within 21 days of the order placing the mortgagee |
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| in possession of the mortgaged real estate, the mortgagee | 2 |
| in possession shall post a written notice on the primary | 3 |
| entrance of each dwelling unit subject to the foreclosure | 4 |
| action that informs the occupants that the mortgagee in | 5 |
| possession is now operating and managing the mortgaged real | 6 |
| estate. This notice shall: | 7 |
| (i) inform occupant that the dwelling unit is the | 8 |
| subject of a foreclosure action and that control of the | 9 |
| mortgaged real estate has changed; | 10 |
| (ii) include the following language: "This is NOT a | 11 |
| notice to vacate the premises."; and | 12 |
| (iii) provide the name, address, and telephone | 13 |
| number of the individual or entity whom occupants may | 14 |
| contact with concerns about the mortgaged real estate | 15 |
| or to request repairs of the property. | 16 |
| (7)(i) The provisions of item (5) of this subsection | 17 |
| (a-5) shall be the exclusive remedy for the failure of a | 18 |
| mortgagee in possession to provide notice to a known | 19 |
| occupant under this Section. | 20 |
| (ii) This Section shall not abrogate any right that a | 21 |
| mortgagee in possession may have to possession of the | 22 |
| mortgaged real estate and to maintain a proceeding against | 23 |
| an occupant of a dwelling unit for possession under Article | 24 |
| 9 of this Code or subsection (h) of Section 15-1701. | 25 |
| (b) Fees and Expenses. A mortgagee in possession shall not | 26 |
| be entitled
to any fees for so acting, but shall be entitled to |
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| reimbursement for
reasonable costs, expenses and third party | 2 |
| management fees incurred in
connection with such possession.
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| (Source: P.A. 84-1462.)
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| (735 ILCS 5/15-1704) (from Ch. 110, par. 15-1704)
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| Sec. 15-1704. Receivers. (a) Receiver. Notwithstanding the
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| provisions of subsections (b), (c) and (d) of Section 15-1701, | 7 |
| and except
as provided in Section 15-1702, upon request of any | 8 |
| party and a showing of
good cause, the court shall appoint a | 9 |
| receiver for the mortgaged real estate.
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| (b) Powers. A receiver appointed pursuant to this Article | 11 |
| shall have
possession of the mortgaged real estate and other | 12 |
| property subject to the
mortgage during the foreclosure, shall | 13 |
| have full power and authority to
operate, manage and conserve | 14 |
| such property, and shall have all the usual
powers of receivers | 15 |
| in like cases. Without limiting the foregoing, a
receiver shall | 16 |
| have the power and authority to:
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| (1) secure tenants and execute leases for the real | 18 |
| estate,
the duration and terms of which are
reasonable and | 19 |
| customary for the type of use involved, and such leases
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| shall have the same priority as if made by the owner of the | 21 |
| real estate;
but, unless approved by the Court, the | 22 |
| receiver shall not
execute oil, gas or other mineral | 23 |
| leases, or (even if otherwise allowed by
law) leases | 24 |
| extending beyond the time of the receiver's possession;
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| provided, however, with respect to residential real estate |
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| leased by the
receiver, nothing in this Section shall | 2 |
| affect the legal rights of any lessee
with respect to the | 3 |
| safety and habitability of the residential real estate;
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| (2) collect the rents, issues and profits from the | 5 |
| mortgaged real estate;
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| (3) insure the mortgaged real estate against loss by | 7 |
| fire or other casualty;
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| (4) employ counsel, custodians, janitors and other | 9 |
| help; and
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| (5) pay taxes which may have been or may be levied | 11 |
| against the mortgaged real estate.
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| (c) Duties. A receiver appointed pursuant to this Article | 13 |
| must manage
the mortgaged real estate as would a prudent | 14 |
| person, taking into account
the effect of the receiver's | 15 |
| management on the interest of the mortgagor.
A receiver may, | 16 |
| without an order of the court, delegate managerial
functions to | 17 |
| a person in the business of managing real estate of the kind
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| involved who is financially responsible, not related to the | 19 |
| mortgagee or
receiver and prudently selected. However, the | 20 |
| receiver
shall remain responsible to the mortgagor or other
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| persons for the acts or omissions of such management agent. | 22 |
| When fees are
paid to such a management agent, the receiver's | 23 |
| fees may be adjusted to the
extent the court deems appropriate. | 24 |
| In managing the mortgaged real estate
and other property | 25 |
| subject to the mortgage,
a receiver or receiver's delegate, to | 26 |
| the extent the receiver receives
sufficient receipts from the |
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| mortgaged real estate, such other property or
other sources, | 2 |
| except to the extent ordered otherwise by the court:
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| (1) shall maintain the existing casualty and liability | 4 |
| insurance
required in accordance with the mortgage or | 5 |
| applicable to the real estate
and other property subject to | 6 |
| the mortgage at the time the receiver took possession;
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| (2) shall use reasonable efforts to maintain the real | 8 |
| estate and other
property subject to the mortgage in at | 9 |
| least as good condition as existed at
the time the receiver | 10 |
| took possession, excepting reasonable wear and tear
and | 11 |
| damage by any casualty;
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| (2.5) shall accept all rental payments from an occupant | 13 |
| of the mortgaged property, and any payments from a third | 14 |
| party or any rental assistance program in support of an | 15 |
| occupant's housing; | 16 |
| (3) shall apply receipts to payment of ordinary | 17 |
| operating expenses,
including royalties, rents and other | 18 |
| expenses of management;
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| (4) shall pay any shared or common expense assessments | 20 |
| due to any
association of owners of interests in real | 21 |
| estate to the extent that such
assessments are or may | 22 |
| become a lien against the mortgaged real estate;
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| (5) may pay the amounts due under any mortgage if the | 24 |
| mortgagee thereof
is not a party in the foreclosure;
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| (6) may carry such additional casualty and liability | 26 |
| insurance as is
reasonably available and reasonable as to |
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| amounts and risks covered;
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| (7) may make other repairs and improvements necessary | 3 |
| to comply with
building, housing, and other similar codes | 4 |
| or with existing contractual
obligations affecting the | 5 |
| mortgaged real estate;
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| (8) may hold receipts as reserves reasonably required | 7 |
| for the foregoing purposes; and
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| (9) may take such other actions as may be reasonably | 9 |
| necessary to
conserve the mortgaged real estate and other | 10 |
| property subject to the
mortgage, or as otherwise | 11 |
| authorized by the court.
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| (d) Allocation of Receipts. Receipts received from | 13 |
| operation of the
real estate and other property subject to the | 14 |
| mortgage by the receiver
shall be applied in the following | 15 |
| order of priority.
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| (1) to reimbursement of the receiver for all reasonable | 17 |
| costs and
expenses incurred by the receiver or the | 18 |
| receiver's delegates;
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| (2) to payment of insurance premiums authorized in | 20 |
| paragraph (1) of
subsection (c) of Section 15-1704;
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| (3) to payment of the receiver's delegates of any | 22 |
| reasonable management
fees for managing real estate of the | 23 |
| type involved;
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| (4) to payment of receiver's fees allowed by the court;
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| (5) to payment of expenses authorized in paragraphs | 26 |
| (2), (3) and (4) of
subsection (c) of Section 15-1704;
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| (6) to payment of amounts authorized in paragraph (5) | 2 |
| of subsection (c)
of Section 15-1704;
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| (7) to payment of expenses authorized in paragraphs (6) | 4 |
| and (7) of
subsection (c) of Section 15-1704; and
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| (8) the balance, if any, shall be held or disbursed as | 6 |
| ordered by the court.
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| (e) Non-Liability for Allocations. A receiver shall in no | 8 |
| event be
liable to any person for the allocation of, or failure | 9 |
| to allocate,
receipts to possible expenditures within the same | 10 |
| priority category.
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| (f) Notice to occupants. | 12 |
| (1) Following an order appointing a receiver pursuant | 13 |
| to Section 15-1704, but no later than 21 days after the | 14 |
| entry of such order, the appointed receiver shall make a | 15 |
| good faith effort to ascertain the identities and addresses | 16 |
| of all occupants of dwelling units of the mortgaged real | 17 |
| estate. | 18 |
| (2) Following an order appointing a receiver pursuant | 19 |
| to Section 15-1704, but no later than 21 days after the | 20 |
| entry of such order, the appointed receiver shall notify | 21 |
| all known occupants of dwelling units of the mortgaged real | 22 |
| estate that the receiver has been appointed receiver of the | 23 |
| mortgaged real estate. Such notice shall be in writing and | 24 |
| shall: | 25 |
| (i) identify the occupant being served by the name | 26 |
| known to the receiver; |
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| (ii) inform the occupant that the mortgaged real | 2 |
| estate at which the dwelling unit is located is the | 3 |
| subject of a foreclosure action and that control of the | 4 |
| mortgaged real estate has changed; | 5 |
| (iii) provide the name, address, and telephone | 6 |
| number of the individual or entity whom occupants may | 7 |
| contact with concerns about the mortgaged real estate | 8 |
| or to request repairs of that property; | 9 |
| (iv) include the following language, or language | 10 |
| that is substantially similar:
"This is NOT a notice to | 11 |
| vacate the premises. You may wish to contact a lawyer | 12 |
| or your local legal aid or housing counseling agency to | 13 |
| discuss any rights that you may have."; and | 14 |
| (v) include the name of the case, the case number, | 15 |
| and the court where the foreclosure action is pending. | 16 |
| (3) The written notice required by item (2) of this | 17 |
| subsection (f) shall be served by delivering a copy thereof | 18 |
| to the known occupant, or by leaving the same with some | 19 |
| person of the age of 13 years or upwards, who is residing | 20 |
| on or in possession of the premises; or by sending a copy | 21 |
| of the notice to the known occupant by first-class mail, | 22 |
| addressed to the occupant by the name known to the | 23 |
| receiver. | 24 |
| (4) In the event that a receiver ascertains the | 25 |
| identity and address of an occupant of a dwelling unit of | 26 |
| the mortgaged real estate more than 21 days after |
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| appointment pursuant to Section 15-1704, the receiver | 2 |
| shall provide the notice required by item (2) of this | 3 |
| subsection (f) within 7 days of ascertaining the identity | 4 |
| and address of the occupant. | 5 |
| (5)(i) A receiver who fails to comply with items (1), | 6 |
| (2), (3), and (4) of this subsection (f) may not collect | 7 |
| any rent due and owing from a known occupant, or terminate | 8 |
| a known occupant's tenancy for non-payment of such rent, | 9 |
| until the receiver has served the notice described in item | 10 |
| (2) of this subsection (f) upon the known occupant. After | 11 |
| providing such notice, the receiver may collect any and all | 12 |
| rent otherwise due and owing the receiver from the known | 13 |
| occupant and may terminate the known occupant's tenancy for | 14 |
| non-payment of such rent if the receiver otherwise has such | 15 |
| right to terminate. | 16 |
| (ii) An occupant who previously paid rent for the | 17 |
| current rental period to the mortgagor, or other entity | 18 |
| with the authority to operate, manage, and conserve the | 19 |
| mortgaged real estate at the time of payment, shall not be | 20 |
| held liable for that rent by the receiver, and the | 21 |
| occupant's tenancy shall not be terminated for non-payment | 22 |
| of rent for that rental period. | 23 |
| (6) Within 21 days of appointment, the receiver shall | 24 |
| post a written notice on the primary entrance of each | 25 |
| dwelling unit subject to the foreclosure action that | 26 |
| informs occupants that the receiver has been appointed to |
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| operate and manage the property. This notice shall: | 2 |
| (i) inform occupant that the dwelling unit is the | 3 |
| subject of a foreclosure action and that control of the | 4 |
| mortgaged real estate has changed; | 5 |
| (ii) include the following language: "This is NOT a | 6 |
| notice to vacate the premises."; and | 7 |
| (iii) provide the name, address, and telephone | 8 |
| number of the individual or entity whom occupants may | 9 |
| contact with concerns about the mortgaged real estate | 10 |
| or to request repairs of the property. | 11 |
| (7)(i) The provisions of item (5) of this subsection | 12 |
| (f) shall be the exclusive remedy for the failure of a | 13 |
| receiver to provide notice to a known occupant under this | 14 |
| Section. | 15 |
| (ii) This Section shall not abrogate any right that a | 16 |
| receiver may have to possession of the mortgaged real | 17 |
| estate and to maintain a proceeding against an occupant of | 18 |
| a dwelling unit for possession under Article 9 of this Code | 19 |
| or subsection (h) of Section 15-1701. | 20 |
| (g) Increase of rents. Notwithstanding any other provision | 21 |
| of this Article, a receiver shall not charge an occupant of the | 22 |
| mortgaged real estate a rental amount above that which the | 23 |
| occupant had been paying for use and occupancy of the mortgaged | 24 |
| real estate prior to the appointment of a receiver without | 25 |
| leave of court. The court may allow an increase of rent if, | 26 |
| upon motion by the receiver, the court finds by a preponderance |
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| of the evidence, that the increase of rent is necessary to | 2 |
| operate, manage, and conserve the mortgaged real estate | 3 |
| pursuant to this Section. A list of the current rents for each | 4 |
| unit in the mortgaged real estate, and a list of the proposed | 5 |
| rent increase for each of those units, must be attached to a | 6 |
| motion for a rent increase under this subsection (g). All | 7 |
| occupants of the mortgaged real estate who may be affected by | 8 |
| the motion for a rent increase, if not otherwise entitled to | 9 |
| notice, shall be notified in writing of the nature of the | 10 |
| motion, the date and time of the motion, and the court where | 11 |
| the motion will be heard. Such notice shall be by personal | 12 |
| service or first-class mail. In the event that the receiver and | 13 |
| an occupant of a dwelling unit agree to a rent increase for | 14 |
| that dwelling unit, the receiver is excused from the | 15 |
| requirements of this subsection (g) as to that dwelling unit. | 16 |
| Nothing in this subsection (g) shall alter the terms of any | 17 |
| lease agreement. | 18 |
| (h) (f) Removal. The court may remove a receiver upon a | 19 |
| showing of good
cause, in which case a new receiver may be | 20 |
| appointed in accordance with
subsection (b) of Section 15-1702 | 21 |
| and subsection (a) of Section 15-1704.
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| (Source: P.A. 84-1462.)
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| Section 98. Compliance. In a foreclosure action filed on or | 24 |
| before the effective date of this Act, a holder or purchaser, | 25 |
| receiver, or mortgagee in possession required to serve notice |
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| or otherwise comply with Section 15-1508.5, subsection (a-5) of | 2 |
| Section 15-1703, and subsection (f) of 15-1704 shall have an | 3 |
| additional 60 days to comply with the provisions of this Act.
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| Section 99. Effective date. This Act takes effect 90 days | 5 |
| after becoming law.
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