The practice of providing bailout money to save people about to have their mortgage forclosed upon is fairly prevalent in Illinois. Very often the people being bailed out from a mortgage they can not repay end up with such a bad deal with the bailout agent, they are unable to become whole in the process and still lose the house. The state legislature has come up with some alternatives to provide some legal protection against those being bailed out and unable to protect themselves.
A bill that would allow struggling homeowners to back out of suspect mortgage “bailout” deals passed the Senate Monday and went to the governor. The bill puts restrictions on a burgeoning industry that promises to save the homes of cash-strapped owners, but has been linked to numerous scams.
Under the legislation, bailout firms would have to detail their services in writing, and homeowners would have greater flexibility in canceling the agreements. In the controversial bailout deals, a homeowner deeds his house to an investor for a year, hoping to use that time to get out of debt and repurchase the home with a fresh mortgage. Instead, critics say, the home is often lost in the process. via the Chicago Tribune
