- January 25, 2011
- All Illinois Issuing Offices
- IL Foreclosures involving a Deceased Borrower
There is a recent Illinois Supreme Court Case ABN AMRO Mortgage Group, Inc. v. Nona L McGahan 237 Ill. 2d 526, June 4, 2010, opinion stating that in a foreclosure action where the mortgagor is deceased the mortgagee must name a personal representative for the deceased in order to obtain subject matter jurisdiction. This means that when doing minutes of foreclosure commitments it is no longer permissible to show "heirs and legatees of the deceased mortgagor" as a necessary party. The foreclosure would fail if there is no personal representative appointed and named as a necessary party. The representative can be appointed in two ways, either lender can open up a probate case and have the personal representative appointed or it can petition the court to appoint one under 735 ILCS 5/13-209.
If you are issuing commitments or examining foreclosure proceedings for minutes of foreclosure, REO sales or other third party sale after a foreclosure in Illinois involving a deceased mortgagor you must determine if a Personal Representative has been appointed and named a party to the foreclosure action. If not you must raise the following exception:
The commitment and any policy issued from it is subject to the possibility of the foreclosure being challenged and/or overturned as being invalid as there was no personal representative for the deceased mortgagor named as a necessary party to the proceedings and such further exceptions as may be deemed necessary.
If coverage is requested to insure over the lack of having a personal representative appointed to represent the deceased mortgagor in the mortgage foreclosure case you must contact Stewart Underwriting Personnel before proceeding to close and insure the title to the property.
If you have any questions relating to this or other bulletins, please contact your local underwriting personnel or Stewart Legal Services or
Charles J. Vachout, Jr.
Associate Senior Underwriting Counsel
Stewart Title Guaranty Company
2800 W, Higgins Road, Ste 325
Hoffman Estates, IL 60169
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