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List of Forms by Chapter - Chapter 1 — Alternative Statutory and Nonstatutory Remedies
- Chapter 2 — Seller Financing and Forfeiture of Installment Agreements
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I. Introduction - II. Seller as Lender
- [2.5] Definition of Seller Financing
- [2.6] Seller’s Dual Role
- [2.7] Seller as Transferor
- [2.8] Benefits and Burdens of Ownership
- [2.9] Retention of Security Interest
- [2.10] Seller as Lender
- [2.11] Underwriting the Risk
- [2.12] Financing Terms
- [2.13] Parties to the Transaction
- [2.14] Due-on-Sale Provision
- [2.15] Extent of the Purchaser’s Rights and Responsibilities
- [2.16] Maintenance of the property
- [2.17] Altering the property
- [2.18] Real estate taxes
- [2.19] Insuring the property
- [2.20] Condemnation proceeds
- [2.21] Liability for Municipal Services
- [2.22] Provisions for Security
- [2.23] Forfeiture Provisions
- [2.24] Title Insurance
- III. Financing Methods
- [2.25] Installment Contract
- [2.26] Structure
- [2.27] Sales Provisions
- [2.28] Financing Provisions
- [2.29] Covenants and Restrictions
- [2.30] Deed
- [2.31] Default and Remedies
- [2.32] Recordation of the Contract
- [2.33] Advantages to the Purchaser
- [2.34] Advantages to the Seller
- [2.35] Disadvantages
- [2.36] Purchase-Money Note and Mortgage
- [2.37] Structure
- [2.38] Sales Contract
- [2.39] Installment Promissory Note
- [2.40] Security
- [2.41] Advantages to the Purchaser
- [2.42] Advantages to the Seller
- [2.43] Disadvantages
- [2.44] Other Seller Financing Methods
- [2.45] Nonrecourse Note and Mortgage
- [2.46] No Security
- [2.47] Security in Other Property
- [2.48] Lease with Option To Purchase
- [2.49] Assumption of Existing Mortgage
- [2.50] Selling Subject to Existing Mortgage
- [2.51] Wraparound Mortgage
- IV. Requirements
- [2.52] Specific Requirements
- [2.53] Compliance with Applicable Dwelling Code
- [2.54] Truth in Lending
- [2.55] Land Trust Disclosures
- [2.56] General Requirements
- Disclosures
- [2.57] Residential Real Property Disclosure
- [2.58] Lead-Based Paint Hazards
- [2.59] Radon
- [2.60] Agricultural Foreign Investment Disclosure
- [2.61] Recording Cannot Be Prohibited
- [2.62] Uniform Vendor and Purchaser Risk Act
- [2.63] Condemnation
- [2.64] Plat Act
- [2.65] Land Trustee as Creditor
- V. Income and Transfer Tax Issues
- [2.66] In General
- [2.67] General Reporting Requirements
- [2.68] Treasury Regulation Requirement
- [2.69] Information To Be Solicited and Reported
- [2.70] Definition of Real Estate Transaction
- [2.71] Definition of Reportable Real Estate
- [2.72] Reporting Person
- [2.73] Exempt Transferors
- [2.74] No Direct Fee
- [2.75] Reporting Requirement Exemption
- [2.76] Exchange of Residence
- [2.77] Exclusion of Gain from Sale of Principal Residence
- [2.78] General Exclusion
- [2.79] Exclusion Amount
- [2.80] Special Rule for Surviving Spouse
- [2.81] Once Every Two Years
- [2.82] Exclusion of Gain Not Available for Nonqualified Use
- [2.83] Exclusion of Gain if Ownership and Use Are Less than Two out of Five Years
- [2.84] Ownership and Use Period Reduced by Out-of-Residence Care
- [2.85] Foreign Investment in Real Property
- [2.86] Installment Sale Method of Reporting Income
- [2.87] Income Recognized
- [2.88] Automatic Election
- [2.89] Disposition to Related Person Limitation
- [2.90] Sale of Depreciable Property to a Related Person
- [2.91] Interest Rate
- [2.92] History
- [2.93] General Applicability
- [2.94] Exceptions
- [2.95] Adjusted Tax Basis
- [2.96] Computing Gain or Loss
- [2.97] Amount Realized
- [2.98] Amount Recognized
- [2.99] Adjusted Tax Basis
- [2.100] Bargain Sale to a Charitable Organization
- [2.101] Basis of Property Acquired from a Decedent
- [2.102] Property Representing Income in Respect of a Decedent
- [2.103] Basis of Property Acquired by Gift
- [2.104] One-Year Basis Transfer Rule
- [2.105] Cancellation of Indebtedness Income
- First-Time Home Buyer Tax Credit
- [2.106] Initial Law
- [2.107] Recapture Provision
- [2.108] Extension and Modification
- [2.109] Further Extension and Modification
- [2.110] Tax-Deferred Exchanges
- [2.111] Illinois Real Estate Transfer Tax
- [2.112] Illinois Real Estate Transfer Tax Law
- [2.113] Land Trust Recordation and Transfer Tax Act
- VI. Other Installment Contract Issues
- [2.114] To Record or Not To Record
- [2.115] Equitable Conversion
- [2.116] Deed and Money Escrow
- Joint Tenancy
- [2.117] Statutory Specificity
- [2.118] Applicability to Installment Contracts
- [2.119] Deed Reformation
- [2.120] Duty of the Seller To Convey to Joint Tenants
- [2.121] Applicability to Assignees of Purchasers
- [2.122] Exemption of Homestead
- VII. Remedies on Default
- VIII. Forfeiture
- [2.126] In General
- [2.127] Possession
- [2.128] Forcible Entry Prohibited
- [2.129] Applicability of Forcible Entry and Detainer Statutes
- [2.130] Inapplicability of Forcible Entry and Detainer Statutes
- [2.131] Discretionary Use of Illinois Mortgage Foreclosure Law
- Statutory Notice and Demand
- [2.132] Right To Cure
- [2.133] Declaration of Forfeiture
- [2.134] Demand for Possession
- [2.135] Proceeding with Forcible Entry and Detainer Action
- [2.136] Pleadings
- [2.137] Evidence
- [2.138] Notice to Unknown Occupants
- [2.139] Constructive Service
- [2.140] Military Personnel
- [2.141] Jury Trial
- [2.142] Trial ex Parte
- [2.143] Standard of Proof
- [2.144] Stay of Enforcement
- [2.145] Pursuing Other Remedies
- [2.146] Clearing Title
- IX. Appendix
- [2.147] Warning Notice: Notice of Intention To Declare a Forfeiture of All Rights Under an Installment Contract and Notice of Intention To File a Forcible Entry and Detainer (Eviction) Action
- [2.148] Declaration of Forfeiture and Termination of All Rights of Purchaser Under Installment Contract
- [2.149] Demand for Possession
- [2.150] Affidavit of Seller
- Chapter 3 — Deficiencies, Surpluses, and Entitlements
- I. [3.1] Introduction
- II. Sale Proceeds and Surpluses
- [3.2] Statutory Distribution Under 735 ILCS 5/15-1512
- [3.3] 735 ILCS 5/15-1512(a) — Expenses of Sale
- [3.4] 735 ILCS 5/15-1512(b) — Maintenance Expenses
- [3.5] 735 ILCS 5/15-1512(c) — Satisfaction of Claims as Adjudicated in the Judgment of Foreclosure and Sale
- [3.6] 735 ILCS 5/15-1512(d) — Surplus To Be Held by Selling Officer Pending Further Order of Court
- Right to Surplus
- [3.7] Mortgagor’s Entitlement
- [3.8] Foreclosed Lienholders
- [3.9] Application of Surplus to Prior Interests or Liens
- [3.10] Equitable Lienholders
- [3.11] Forfeiture of Surplus
- III. Deficiency Judgment
- Statutory Right to Deficiency
- [3.12] 735 ILCS 5/15-1511 — Deficiency
- [3.13] 735 ILCS 5/15-1508(e) — Deficiency Judgment
- [3.14] Entry of Deficiency Judgment as Mandatory
- [3.15] Request in Complaint To Foreclose
- [3.16] Personal Jurisdiction over Persons Liable
- [3.17] Deficiency Judgment as Part of Order Confirming Sale
- [3.18] Memorandum of Judgment
- [3.19] In Rem Judgment vs. In Personam Judgment
- [3.20] Determining Amount of Deficiency
- Defenses to Entry of Deficiency Judgment
- [3.21] Discharge in Bankruptcy
- [3.22] Deed in Lieu of Foreclosure
- [3.23] Consent Foreclosure
- [3.24] Objections to Confirmation of Foreclosure Sale
- [3.25] Inability to Pay
- [3.26] Res Judicata
- [3.27] Setoff
- [3.28] Liability of Guarantors for Deficiencies
- [3.29] Avoidance of Deficiency Judgments in Bankruptcy
- Chapter 4 — Bankruptcy Considerations in Foreclosure
- I. [4.1] Introduction
- II. [4.2] Scope of Automatic Stay
- III. [4.3] Duration of Automatic Stay
- IV. [4.4] Property of the Estate
- V. Motion for Relief from Automatic Stay
- [4.8] In General
- [4.9] Statement of Default/Motion To Modify Stay
- Service of Notice of Motion
- [4.10] In General
- [4.11] Sample Notice of Motion
- [4.12] Filing Motion for Relief from Stay
- Form of Motion for Relief from Stay
- [4.13] In General
- Sample Motions for Relief from Stay
- [4.14] Chapter 7 Filing
- [4.15] Chapter 13 Filing
- Basis of Motion for Relief from Stay
- [4.16] Lack of Equity
- [4.17] Property Not Necessary to an Effective Reorganization
- [4.18] In Rem Relief/Abusive Filings
- [4.19] Ineligible Debtors
- [4.20] Preliminary Hearing Within 30 Days
- [4.21] Final Hearing Within 30 Days/Termination of Stay
- [4.22] Sample Order for Relief from Stay
- VI. [4.23] Debtor’s Defense: Adequate Protection
- VII. [4.32] Single-Asset Real Estate Case
- VIII. [4.33] Relief from Automatic Stay for Cause
- Chapter 5 — Environmental Considerations for Parties in Foreclosure
- I. [5.1] General Considerations
- II. [5.2] Lender’s Statutory Environmental Cleanup Exposure Under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980
- III. [5.3] The Lender Liability Rule
- IV. [5.4] The Asset Conservation, Lender Liability, and Deposit Insurance Protection Act of 1996
- V. [5.5] Lender Liability and the Secured Creditor’s Exemption Under the Environmental Protection Act
- VI. [5.6] Lender’s Environmental Liability for Underground Storage Tanks
- VII. [5.7] Lender’s Environmental Due Diligence Pre-Loan and Pre-Foreclosure
- VIII. [5.8] Exemptions from Liability for Prospective Purchasers and Adjacent Property Owners
- IX. [5.9] Conclusion
- Chapter 6 — Loan Workouts and Short Sales
- I. [6.1] Introduction
- II. [6.2] Loan Workouts
- III. Deed for Lease Program
- IV. Loan Modifications — Lender or Servicer Programs
- V. Loan Modifications — Government Programs
- [6.15] Hope for Homeowners
- Home Affordable Refinancing Program or Home Affordability and Stability Program
- [6.16] In General
- [6.17] Eligibility and Application Procedures
- [6.18] Documentation Required for Home Affordable Refinancing Program Application
- Home Affordable Modification Program
- [6.19] In General
- [6.20] Primary Features
- [6.21] Documentation Required for Home Affordable Modification Program Application
- [6.22] Home Affordable Modification Program and the Net Present Value Test
- [6.23] Incentive Compensation
- VI. Short Sales
- [6.24] In General
- [6.25] Considerations in Representing the Seller in a Short Sale
- [6.26] Elements of a Short Sale
- [6.27] Modifications of the Contract for a Short Sale
- [6.28] Documentation for a Short Sale Package
- [6.29] Treatment of Deficiencies in a Short Sale
- [6.30] Considerations in Representing the Buyer in a Short Sale Transaction
- VII. Forgiveness of Debt
- Chapter 7 — Income Tax Consequences
- I. [7.1] Introduction
- II. [7.2] Tax Consequences of Foreclosure to Mortgagor
- [7.3] Gain or Loss to Mortgagor Resulting from Foreclosure Sale
- [7.4] Characterization of Debt as Capital or Ordinary
- [7.5] Timing for Realization of Gain or Loss Resulting from Foreclosure
- [7.6] Home Sale Gain Exclusion
- [7.7] Discharged Debts Are Includable in Gross Income
- [7.8] Exceptions to Rule That Discharged Indebtedness Is Income
- [7.9] Bankruptcy Exception
- [7.10] Insolvency Exception
- [7.11] Qualified Farm Indebtedness Exception
- [7.12] Qualified Real Property Business Indebtedness Exception
- [7.13] Mortgage Forgiveness Debt Relief Act of 2007
- III. [7.14] Tax Consequences of Foreclosure to Mortgagee
- [7.15] Gain or Loss to Mortgagee Resulting from Foreclosure Sale
- [7.16] Gain or Loss to Mortgagee from Subsequent Sale of Foreclosed Property
- [7.17] Bad-Debt Deduction
- Mortgagee’s Tax Reporting and Withholding Obligations
- [7.18] Mortgagee May Be Required To File IRS Form 1099-A
- [7.19] Mortgagee May Be Required To File IRS Form 1099-C
- [7.20] Foreign Investment in Real Property Tax Act Requirements for Foreclosing Mortgagees
- [7.21] Real Estate Taxes
- Kara Allen
Kara Allen
Kara Allen is an attorney at Gutnicki LLP in Skokie, where she focuses on commercial litigation. She is is a member of the Chicago, Illinois State, and Wisconsin Bar Associations. Ms. Allen received her B.A. and her J.D. from Marquette University.
- William J. Anaya
William J. Anaya
William J. Anaya is an Officer at Greensfelder, Hemker & Gale, P.C., in Chicago, where he concentrates in environmental law transactions and litigation. He is Past Chairman of the Board of IICLE® and has received IICLE®’s Addis Hull Award for Excellence in Legal Education. He is a member of the Illinois State and Indiana State Bar Associations. Mr. Anaya received his B.A. from Purdue University and his J.D. from the Indiana University Maurer School of Law.
- Elizabeth A. Austermuehle
Elizabeth A. Austermuehle
Elizabeth A. Austermuehle is an associate at Greensfelder, Hemker & Gale, P.C., in Chicago, where she is involved with all aspects of litigation, including discovery, depositions, motion practice, strategic planning, and trial preparation. With previous experience as an associate at a large international firm, she is well-versed in processes related to electronic discovery. Ms. Austermuehle’s litigation experience also includes consumer protection claims, securities litigation, and asylum matters. She is a member of the Chicago Bar Association and admitted to the bar in Illinois; the U.S. District Court; Northern District of Illinois; and the U.S. Supreme Court. Ms. Austermuehle earned her B.A. magna cum laude from the University of Illinois at Urbana-Champaign and her J.D. from the University of Chicago Law School.
- Dennis R. Bordyn
Dennis R. Bordyn
Dennis R. Bordyn, Bordyn Law Offices P.C., Downers Grove, concentrates in residential and commercial real estate transactions and litigation and distressed property strategies including short sale negotiation, foreclosure defense, and loss mitigation/loan modification. He is a member of the DuPage County and Illinois State Bar Associations, Director of the Illinois Real Estate Lawyers Association, and member of the Mainstreet Organization of Realtors. Mr. Bordyn received his B.A. from the University of Notre Dame and his J.D. from DePaul University College of Law.
- Barry A. Chatz
Barry A. Chatz
Barry A. Chatz is a Partner at Saul Ewing Arnstein & Lehr LLP in Chicago, where he concentrates in restructuring of business operations, as well as creditors’ rights litigation. He is a member of the Illinois, California, and New York State Bar Associations and the American Bar Association. Mr. Chatz received his B.A. from the University of Wisconsin and his J.D. from DePaul University College of Law.
- Gary R. Gehlbach
Gary R. Gehlbach
Gary R. Gehlbach is a Partner at Ehrmann Gehlbach Badger Lee & Considine, LLC, in Dixon, where he concentrates his practice in real estate, business law, and trust and estate planning and administration. He is a Fellow of the American College of Real Estate Lawyers; a member of the Lee County, Illinois State, and American Bar Associations; and a member of the National Academy of Elder Law Attorneys. Mr. Gehlbach received his undergraduate degree from Knox College and his J.D. with high honors from IIT Chicago-Kent College of Law.
- Amy T. Grace
Amy T. Grace
Amy T. Grace is an associate at Chuhak & Tecson, P.C., in Chicago, where she concentrates in banking and creditors’ rights. She is Past Chair of the Real Estate Committee of the Young Lawyers Section of the Chicago Bar Association, received the Rising Star Award for Exceptional Leadership from the Chicago Bar Association, and is a member of the Chicago and American Bar Associations. Ms. Grace received her B.A. from Regis University and her J.D. from The John Marshall Law School.
- Joshua S. Hyman
Joshua S. Hyman
Joshua S. Hyman is a Principal at Chuhak & Tecson, P.C., in Chicago, where he focuses on banking. He is a member of the Chicago, Illinois State, and American Bar Associations. Mr. Hyman received his B.A. from University of Wisconsin and his J.D. from Washington University School of Law.
- Courtney E. Kennedy
Courtney E. Kennedy
Courtney E. Kennedy is an associate at Ehrmann Gehlbach Badger & Considine, LLC, in Dixon, where she focuses on real estate, bankruptcy, and civil litigation. Ms. Kennedy received her undergraduate degree magna cum laude from Ashford University and her J.D. from Northern Illinois University College of Law.
- Steven C. Lindberg
Steven C. Lindberg
Steven C. Lindberg is Of Counsel at Diaz Anselmo Lindberg P.A. in Naperville, where he concentrates his practice in mortgage foreclosure and real estate. He is a member of the U.S. Foreclosure Network and the Illinois State and Florida Bar Associations. Mr. Lindberg received his B.A. from the University of Illinois at Chicago, his M.S. from St. Joseph’s University, and his J.D. from The UIC John Marshall Law School.
- Kevin H. Morse
Kevin H. Morse
Kevin H. Morse is a Partner at Clark Hill PLC in Chicago, where he focuses on bankruptcy and restructuring. He was named an Illinois Super Lawyers Rising Star in 2020 – 2022 and an Illinois Emerging Lawyer in 2015 – 2022. He is a member of The American Lawyers Magazine Young Lawyers Editorial Board (2018 – 2022) and Co-Chair of the Communications Committee of the Turnaround Management Association. Mr. Morse received his B.A. from the University of Colorado at Boulder and his J.D. from Pepperdine University School of Law.
- Robert H. Rappe, Jr.
Robert H. Rappe, Jr.
Robert H. Rappe, Jr., is managing attorney at Codilis & Associates, P.C., in Burr Ridge, where he focuses on real estate transactions and mortgage foreclosure. He is a member of the Illinois State and DuPage County Bar Associations and the Mortgage Bankers Association. Mr. Rappe received his B.A. from DePaul University and his J.D. from DePaul University College of Law.
- Miriam R. Stein
Miriam R. Stein
Miriam R. Stein is a Principal at Chuhak & Tecson, P.C, in Chicago, where she focuses on litigation, banking, and real estate. She is a member of the Chicago Bar Association and an Illinois Super Lawyer. She is a member of the Chicago Bar Association and the Commercial Law League. Ms. Stein received her B.A. with honors from Northwestern University and her J.D. with honors from IIT Chicago-Kent College of Law.
- William A. Williams
William A. Williams
William A. Williams is an associate at Jenner & Block LLP in Chicago, where he focuses on bankruptcy and restructuring. He is a member of the American Bankruptcy Institute and the Chicago Bar Association. Mr. Williams received his B.A. from Auburn University and his J.D. from the University of Virginia School of Law.
Mortgage Foreclosure (Illinois): Corresponding Issues (ARCHIVED 2016 EDITION)
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