All Forum Posts by: Nicole R.

@Bob Floss II, I would hate to perpetuate the practice that we just went through by providing additional details.

It is unfortunate that there are attorneys out there who provide this type of service as it truly gives the rest of us a bad name. 

@Andy Mirza, that is very interesting and thanks for pointing that out. I have reached out to my eviction attorney for her expertise as I do not have a definitive answer. Given the preferential treatment Cook County gives tenants/foreclosed defendants, I want to say that there's probably a line in the ordinance that trumps the BK filing.

I do know that checking that box would not have allowed us to avoid evicting the supplemental tenants (the foreclosed defendants' adult son and his family were also living at the property). Because the adult son/family were not named parties in the foreclosure suit, they technically, have a right to prove their tenancy. Had they presented a valid lease between himself and the foreclosed defendants (his parents), it would have been even trickier for us. Luckily, that was not the case.

But, the eviction statute here makes an owner evict the supplemental tenants in a supplemental eviction action. If you time things correctly, you can file the supplemental petition at the same time as your motion for possession so as not to waste any more time.

@Tony Rodriguez, thank you for all of the helpful information. Admittedly, my due diligence I complete prior to bidding has been updated since this purchase, but it would not have prevented this. 

The attorney representing the defendants in the chancery court action only filed his appearance in June of 2017 and did not represent them during the foreclosure process at least in an official capacity. I do not think that sticking to property owners who are not represented would necessarily help you either--an attorney can file his/her appearance at anytime during the proceeding. Once they file an appearance, they will likely ask for a continuance to have a chance to review the case history. So, you'd likely be in the same spot and not much further down the road.

Joining the owner to vacate the sale was not feasible. In fact, we did withdraw our motion to confirm the sale when the defendants filed their motion & brief opposing the confirmation, but vacating the sale is actually really difficult to do in Illinois. The only avenue forward for the defendants to vacate the sale was to argue the sale price was unconscionable and, given the area, what we paid for the property was in line. 

To avoid this issue now, we do one of two things: (1) either build in a bigger buffer to account for the legal fees & time (on this property, our margin of error was large enough already, but we are even more conservative now that we've had this experience) or (2) only purchase properties that we know are vacant, which means we are at the actual property in advance. Visiting the property ahead of time was not something we were doing before and we were relying on our title/deed research, existing court file, google street view, and MLS and tax records.

@Andy Mirza, While the BK and Chancery court cases are separate, they are uniquely entertwined here because the chancery court case stops completely once a BK is filed by a defendant. And, the way the BK code is written, I do have standing as a person in interest in the BK case to have filed a motion to ensure the BK stay was lifted in an efficient manner. 

Most of the lenders here in Illinois are represented by two firms specializing in this practice area. Over time, I’ve been able to develop specific contacts in each law firm I can reach out to to get the process started faster or to keep it moving when things have reached a lull. 

@Mark Ainley, yes, I am an attorney. But, you are correct that chancery court is not my preferred practice area—my focus is real estate capital markets and partnership taxation. I did use a great eviction attorney once I was able to get the sale confirmed. 

Regarding the defendants, I had a colleague reach out prior to the sale confirmation to offer a cash for keys settlement, but they declined. It was less expensive for them to pay $5k for their attorney to keep them in the property for a year and a half than it was to take our offer and have to find a new place.

I’d be interested in reaching out to the attorney you use for your confirmation hearings though. Thanks for your thoughts.

@Andy Mirza. Yes, we had our funds tied up from March of 2017 until December 2017 (when the sale was confirmed). 

You are correct, the lender did file the MFR in the BK court. I could not find a way to have standing under the BK code at the time. The best I could find was a motion for sanctions against the attorney of record in the chancery court as he was prolonging the inevitable at our expense. Here in Cook County, these types of motions are not looked kindly upon. I thought I could swing this motion in federal BK court by filing as a "person in interest," but it was a bit of a stretch given how the BK codes defines a PII.

I could be incorrect, but, here in IL, I don't think I could've obtained in rem jurisdiction. I don't technically own the property until the judicial sale is confirmed so, technically, I do not have standing. We filed a motion to intervene in the chancery court action, but the judge stayed our motion (basically, didn't want to grant us entrance into the chancery case) until the BK case was settled.

Also, I don't believe the Lender would've pursued only in rem jurisdiction either as there was a rather large personal deficiency judgement ($300k) that the lender wanted to go after. They needed in personam jurisdiction to do that. I would also be concerned that one would be unable to obtain in rem over the property after the defendants filed for BK (which made the property part of their estate). 

Also, please let me know to which box you're referring regarding the lockout. To my knowledge, Cook County has several ordinances stating that a lockout, under any manner/situation, is illegal. But, please let me know if I'm missing something or let me know what you mean because I'm always looking to figure out different avenues to pursue in these cases.

Regarding the confirmation sale, the judge granted our motion to intervene as a person in interest once the BK cases were settled. Once that occurred, there was a short motion practice where the Defendants tried to prove that the sale price was unconscionable (in IL, there are only 4 ways to void a judicial sale and this one is the "catch-all" argument if you don't fit into the other three). They could not prove that it was unconscionable, so the judge was forced the confirm the sale. 

@Jay Hinrichs, @Alex Deacon, @Brett Goldsmith Just wanted to provide another update on this. We completed the eviction proceedings earlier this year (June 2018) and the eviction was scheduled with the Sheriff's office for August 2018. Oddly, the defendants willingly decided to hand over the keys in late July. So, we took possession July 17th and had everything cleaned out (I'm talking 6 full 20 foot truck loads of stuff), new carpeting installed, and freshly painted by August 31st. We accepted an offer above our list price (but still low for the area) the day after labor day, and we are scheduled to close on 10/29. If it closes (fingers crossed), we will still have about a 12% return. I push thoughts away regarding what our profit would have been had we not encountered these setbacks and am grateful for the learning experiences this property has provided!

@Jay Hinrichs, thanks! Yes, this was a learning experience for us. We now have added this into our checklist when considering foreclosures at auctions. Education (all types) is expensive! I will say, I am learning a lot about the process and knowledge is never a bad thing.

@Alex Deacon, just wanted to check in to see how your situation was progressing? Our sale was confirmed early December 2017 so we are now in the eviction proceedings. 

@Alex Deacon, I'm holding on, but trying to get on the offensive. As an "intervenor" to the state court action, I don't have any standing because the Judge hasn't ruled on my motion. But, now that its in federal court, I think I qualify as a party in interest to allow me standing and to potentially file a motion for sanctions due to the timing and intent of the Chap. 7 filing. Have you discussed this in your situation?