New law means more funds go directly to alleviate foreclosure crisis

SPRINGFIELD, IL – Illinois State Senator Jacqueline Collins (D-Chicago 16th) was pleased to announce the signing of legislation she sponsored to make sure most of the proceeds from foreclosure filing fees go directly to homeowner counseling and abandoned property rehabilitation. Senate Bill 1674, a follow-up measure to the landmark legislation she sponsored last year to expedite foreclosures on abandoned properties, takes effect immediately.

“As the abandoned property foreclosure plan is implemented, it is important to ensure that lenders are charged the correct filing fees, assistance flows to the neighborhoods that need it most and as much money as possible goes directly to alleviating Illinois’ foreclosure crisis,” said Collins, who as chairperson of the Senate Financial Institutions Committee is well-known for her work on foreclosure.

“With the clarity this measure provides, I am confident that communities can move ahead in their recovery from a housing slump that has left too many neighborhoods riddled with unsafe, unsightly homes and vacant lots.”

Last year’s Senate Bill 16 increased foreclosure filing fees, with the largest increases reserved for the lenders filing the most foreclosure actions each year, and directed the proceeds to two funds: one for foreclosure prevention counseling for an additional 18,000 households and another for grants to municipalities seeking to demolish or rehabilitate abandoned properties. The expedited judicial process it created is expected to shorten the foreclosure timeline for abandoned properties from more than 500 days to approximately 100 days.

The new law caps at four percent the amount the Illinois Housing Development Authority may deduct from foreclosure prevention grants to cover its administrative costs. It clarifies the process by which a lender’s filing fee is determined, the process for allocating grants to different regions of the state and other particulars of the original legislation.