Illinois Communities to Receive Foreclosure Help
Madigan told sources she considers the $70 million package a “down payment” to help families struggling to recuperate after losing their homes to foreclosure. The aid money will be distributed to several different organizations that sent proposals to the Attorney General’s office, and will be an important tool in the fight against foreclosure and its negative effects on Illinois communities.
The money will go towards rebuilding neighborhoods that were impacted by the foreclosure crisis, and will help several communities rehabilitate abandoned properties and provide housing counseling to people who lost their homes to foreclosure.
Community organizations that will receive part of the grant include the Cook County Land Bank, the Hispanic Housing Development Corporation, the Community Foundation of the Fox River Valley, and DuPage and Kane counties, both of which were struck particularly hard by the foreclosure crisis.
National Mortgage Settlement Brings Relief for Illinois Families
The relief package announced by Madigan is a direct result of the National Mortgage Settlement, a major victory for housing rights advocates against the largest mortgage servicers in the country. In the lawsuit, homeowners accused the banks of engaging in wide range fraudulent mortgage practices.
Perhaps the most troubling practice was “robo-signing,” in which mortgage lenders had employees sign documents they haven’t read, or used fake signatures to hasten the foreclosure process. These fraudulent practices were made necessary by the banks’ inability to prove they actually owned the mortgages, which were often packaged and sold to dozens of different entities, making it difficult for homeowners to determine who actually held their mortgages.
Thanks to these fraudulent practices, foreclosure defense attorneys were able to settle with the banks for $25 billion. And while almost $2 billion of this settlement has already been directed towards Illinois homeowners, more relief is on the way.