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1 | AN ACT concerning civil law.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | 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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8 | 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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1 | 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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1 | (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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1 | 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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1 | 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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14 | (735 ILCS 5/15-1701) (from Ch. 110, par. 15-1701)
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15 | Sec. 15-1701. Right to possession.
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16 | (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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19 | 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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25 | (b) Pre-Judgment. Prior to the entry of a judgment of |
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1 | foreclosure:
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2 | (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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9 | 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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16 | (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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24 | (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 | (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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8 | (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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15 | 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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22 | (d) After 30 Days After Sale Confirmation. The holder of
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23 | 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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1 | 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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15 | 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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18 | (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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23 | 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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26 | (f) Other Statutes; Instruments. The provisions of this |
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1 | 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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7 | no mortgage or other instrument may modify or supersede the | ||||||
8 | provisions of this
Article.
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9 | (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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17 | (h) Proceedings Against Certain Occupants.
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18 | (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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25 | to the foreclosure. The supplemental petition for | ||||||
26 | possession shall name each such
occupant against whom |
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1 | possession is sought and state the facts upon which the
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2 | claim for relief is premised.
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3 | (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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13 | (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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17 | 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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1 | 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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1 | 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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16 | (Source: P.A. 95-262, eff. 1-1-08; 95-933, eff. 8-26-08.)
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17 | (735 ILCS 5/15-1703) (from Ch. 110, par. 15-1703)
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18 | 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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21 | (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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1 | instrument authorizing the
taking of possession;
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2 | (2) all other rights and privileges of a mortgagee in | ||||||
3 | possession under
law not inconsistent herewith; and
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4 | (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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9 | 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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11 | (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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1 | (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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1 | 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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1 | 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 |
| |||||||
| |||||||
1 | reimbursement for
reasonable costs, expenses and third party | ||||||
2 | management fees incurred in
connection with such possession.
| ||||||
3 | (Source: P.A. 84-1462.)
| ||||||
4 | (735 ILCS 5/15-1704) (from Ch. 110, par. 15-1704)
| ||||||
5 | Sec. 15-1704. Receivers. (a) Receiver. Notwithstanding the
| ||||||
6 | 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.
| ||||||
10 | (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:
| ||||||
17 | (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
| ||||||
20 | 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;
| ||||||
25 | provided, however, with respect to residential real estate |
| |||||||
| |||||||
1 | 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;
| ||||||
4 | (2) collect the rents, issues and profits from the | ||||||
5 | mortgaged real estate;
| ||||||
6 | (3) insure the mortgaged real estate against loss by | ||||||
7 | fire or other casualty;
| ||||||
8 | (4) employ counsel, custodians, janitors and other | ||||||
9 | help; and
| ||||||
10 | (5) pay taxes which may have been or may be levied | ||||||
11 | against the mortgaged real estate.
| ||||||
12 | (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
| ||||||
18 | 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
| ||||||
21 | 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 |
| |||||||
| |||||||
1 | mortgaged real estate, such other property or
other sources, | ||||||
2 | except to the extent ordered otherwise by the court:
| ||||||
3 | (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;
| ||||||
7 | (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;
| ||||||
12 | (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;
| ||||||
19 | (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;
| ||||||
23 | (5) may pay the amounts due under any mortgage if the | ||||||
24 | mortgagee thereof
is not a party in the foreclosure;
| ||||||
25 | (6) may carry such additional casualty and liability | ||||||
26 | insurance as is
reasonably available and reasonable as to |
| |||||||
| |||||||
1 | amounts and risks covered;
| ||||||
2 | (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;
| ||||||
6 | (8) may hold receipts as reserves reasonably required | ||||||
7 | for the foregoing purposes; and
| ||||||
8 | (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.
| ||||||
12 | (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.
| ||||||
16 | (1) to reimbursement of the receiver for all reasonable | ||||||
17 | costs and
expenses incurred by the receiver or the | ||||||
18 | receiver's delegates;
| ||||||
19 | (2) to payment of insurance premiums authorized in | ||||||
20 | paragraph (1) of
subsection (c) of Section 15-1704;
| ||||||
21 | (3) to payment of the receiver's delegates of any | ||||||
22 | reasonable management
fees for managing real estate of the | ||||||
23 | type involved;
| ||||||
24 | (4) to payment of receiver's fees allowed by the court;
| ||||||
25 | (5) to payment of expenses authorized in paragraphs | ||||||
26 | (2), (3) and (4) of
subsection (c) of Section 15-1704;
|
| |||||||
| |||||||
1 | (6) to payment of amounts authorized in paragraph (5) | ||||||
2 | of subsection (c)
of Section 15-1704;
| ||||||
3 | (7) to payment of expenses authorized in paragraphs (6) | ||||||
4 | and (7) of
subsection (c) of Section 15-1704; and
| ||||||
5 | (8) the balance, if any, shall be held or disbursed as | ||||||
6 | ordered by the court.
| ||||||
7 | (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.
| ||||||
11 | (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; |
| |||||||
| |||||||
1 | (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 |
| |||||||
| |||||||
1 | 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 |
| |||||||
| |||||||
1 | 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 |
| |||||||
| |||||||
1 | 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.
| ||||||
22 | (Source: P.A. 84-1462.)
| ||||||
23 | 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 |
| |||||||
| |||||||
1 | 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.
| ||||||
4 | Section 99. Effective date. This Act takes effect 90 days | ||||||
5 | after becoming law.
|