The Confirmation Hearing: The Last Real Chance to Challenge an Illinois Foreclosure Sale

An Illinois foreclosure sale is not final when the auction ends. The sheriff or the selling officer reports the sale to the court, and the lender, or whoever bought the property, files a motion asking the judge to approve it. Until that motion is granted, title has not passed, the judgment has not become appealable, and a homeowner living in the property is generally still entitled to stay there.

That motion is usually called the motion for an order approving sale, or the motion to confirm. It corresponds to the sixth stage in our overview, How Long Does a Foreclosure Take in Illinois?, and it is the stage that most often gets treated as a formality. It is not a formality. The statute sets out specific reasons a judge can refuse to approve a sale, and the hearing is where those reasons are raised. This article walks through what the court examines, what the order does once it is entered, and what the thirty days after it look like.

1. Where the hearing sits in the case

Under 735 ILCS 5/15-1508(a), the person who conducted the sale files a report with the court. The plaintiff then moves to confirm, on notice under the court's ordinary motion rules. Under 15-1508(b), the court must confirm the sale unless it finds one of four things: that a required notice of the sale was not given, that the terms of the sale were unconscionable, that the sale was conducted fraudulently, or that "justice was otherwise not done."

The timing of the motion matters for a second reason. In Wells Fargo Bank, N.A. v. McCluskey, 2013 IL 115469, the Illinois Supreme Court held that a homeowner who was defaulted can ask to vacate that default under the more flexible standard of 735 ILCS 5/2-1301(e) only up until the motion to confirm is filed. Once the motion to confirm is on file, any challenge is judged under the narrower terms of 15-1508(b). A homeowner who waits for the hearing date to raise a defense has already moved into the harder standard. (The stretch between judgment and the auction itself is covered in You Have A Sale Date - What Can Be Done?)

What can be done here. Before the motion to confirm is filed, the file is reviewed for whether a motion to vacate the judgment belongs in front of the court while the broader standard still applies. After it is filed, the report of sale, the notice of sale, the certificate of publication and the proof of mailing are pulled and compared against what the statute requires, and a written response or objection is prepared for the hearing date.

2. Was the sale properly noticed?

The first ground is notice. Section 15-1507(c) requires the sale to be published and requires notice to be given to the parties to the case, and 15-1508(b)(i) allows the court to refuse confirmation if that notice was not given.

Section 15-1508(c) gives a party who was entitled to notice and did not receive it a specific remedy: a motion, supported by affidavit and filed before the sale is confirmed, asking the court to set the sale aside. Ordinarily the moving party must guarantee or bond a bid equal to the winning bid at the first sale. The statute makes an exception for a mortgagor of residential real estate who occupies the property when the motion is filed. In that situation no bond is required.

Section 15-1508(d) sets the other side of the line. A sale is not set aside simply because of a defect in the notice or the publication, except on good cause shown at a hearing. The court looks at whether the defect actually affected who knew about the sale.

What can be done here. The notice of sale is checked for the date, time, place and legal description; the publication is checked against the statutory schedule; and the mailing is checked against the addresses of record. Where a residential owner in occupancy did not receive required notice, the 15-1508(c) motion is prepared and filed before the sale is confirmed, because after confirmation that remedy is no longer available.

3. The terms of the sale and the price

The second ground is that the terms of the sale were unconscionable. Homeowners often raise the price first, because the number in the report of sale is frequently far below what the house would bring on the open market.

A forced sale at auction rarely brings full market value, and a low price on its own does not tend to carry this argument. The question the court is weighing is whether the terms of this particular sale, taken as a whole, were so one-sided that approving them would be unconscionable. A low price combined with a problem in how the sale was noticed, scheduled or run is a different argument from a low price alone.

What can be done here. The credit bid is compared against the judgment amount, recent comparable sales and any appraisal or broker opinion in the file, and the sale's timing and terms are reviewed for anything that would have depressed bidding. Where the price and the process point in the same direction, both are put in front of the court together.

4. "Justice was otherwise not done"

The fourth ground is the broadest in wording and the narrowest in practice. In McCluskey, the Supreme Court explained that at this stage it is not enough for the homeowner to show a defense that would have been good earlier in the case. The homeowner must show that "the lender, through fraud or misrepresentation, prevented the borrower from raising his meritorious defenses to the complaint at an earlier time in the proceedings, or the borrower has equitable defenses that reveal he was otherwise prevented from protecting his property interests."

In plain terms, the court is asking why the problem is being raised now rather than before judgment, and whether something the lender or servicer did is the reason. A homeowner who was told by the servicer that the sale was on hold while a modification was reviewed, and who stopped defending the case as a result, is making a different argument from a homeowner who simply did not respond to the complaint.

What can be done here. The servicing record is rebuilt: the loss mitigation correspondence, the servicer's notes where they can be obtained, any written or recorded statement about the sale being postponed, and the dates of each. The objection to confirmation ties those facts to the McCluskey standard specifically, because a general claim that the result is unfair does not meet it.

5. Loss mitigation and the federal sale prohibition

Loss mitigation often comes back into the case at this stage. Under the federal servicing rules in Regulation X, if a borrower submits a complete loss mitigation application after the foreclosure is filed but more than 37 days before a foreclosure sale, the servicer may not move for judgment or an order of sale, or conduct the sale, unless the servicer has told the borrower in writing that they are not eligible for any option and the appeal process has ended or does not apply, the borrower has rejected every option offered, or the borrower has failed to perform under an agreement. 12 C.F.R. § 1024.41(g).

Whether a sale went forward in violation of that rule is a factual question: when the application became complete, what the servicer sent and when, and whether the sale date was more than 37 days away at that point. Those facts can bear on whether justice was done in the sale and are raised at the confirmation hearing when they exist.

A separate statutory right can also come into play. Under 735 ILCS 5/15-1604, when the property is residential, the lender that was a party to the case (or its nominee) bought the property at the sale, and the sale price was less than the full amount needed to redeem, the mortgagor has a special right to redeem for 30 days after the sale is confirmed, by paying the sale price plus the costs and expenses confirmed in the report of sale and interest at the judgment rate. Unlike ordinary redemption, the amount is tied to the bid, not to the full judgment. Loan modification work at this stage is covered in more detail on our Loan Modifications page.

What can be done here. The loss mitigation timeline is reconstructed against the sale date and against 1024.41(g), and any violation is raised in the objection. Where the lender was the buyer and the numbers fit 15-1604, the special redemption figure is calculated and the 30-day deadline is docketed from the day the order is entered.

6. What the order approving sale does

If the court confirms the sale, the order does several things at once, and each one has consequences.

It makes the case appealable. In EMC Mortgage Corp. v. Kemp, 2012 IL 113419, the Supreme Court held that the judgment of foreclosure is not final and appealable on its own; the order confirming the sale is the final order. The 30-day deadline to file a notice of appeal under Illinois Supreme Court Rule 303 runs from that order, and our Appeals & Post-Judgment page describes that process.

It settles the money. Under 15-1508(f), the judgment is satisfied to the extent of the sale price, less expenses and costs. Under 15-1508(e), the court also enters a personal deficiency judgment for any shortfall, but only if it is otherwise authorized and only to the extent it was requested in the complaint and proven. If the sale produced more than was owed, the excess is a surplus, and 735 ILCS 5/15-1512 governs how it is distributed.

It awards possession. Under 15-1508(g), the order confirming the sale awards possession to the buyer as of 30 days after the order is entered, and an order of possession can be entered and enforced only against persons personally named in it.

What can be done here. The proposed order is read line by line before the hearing: whether a deficiency was pleaded and proven, whether the costs and fees in the report of sale are supported, whether the order names people who are not parties, and whether any surplus is being addressed. Objections to the form of the order are made at the hearing, when it can still be changed.

7. The 30 days after the order

Under 735 ILCS 5/15-1701, a mortgagor of residential real estate generally remains entitled to possession through judgment and until 30 days after the order confirming the sale. After that, the holder of the certificate of sale, or the deed issued on it, is entitled to possession. If the home is not vacated, the order of possession can be enforced by the sheriff. Occupants who were not named in the case are handled separately; under 15-1701(h), the buyer may file a supplemental petition against a person not personally named, up to 90 days after the order confirming the sale.

The thirty days are also the window for an appeal and for a motion to reconsider. An appeal does not by itself stop the order from being enforced. A stay pending appeal usually requires a bond or other security under Rule 305, and under Rule 305(k), if no stay is in place, reversal on appeal does not affect the rights of a non-party who acquires the property after the judgment becomes final. A later challenge under 735 ILCS 5/2-1401 is possible within two years, but on narrow grounds.

What can be done here. The 30-day possession date, the 30-day special redemption date where it applies, and the 30-day appeal deadline are docketed the day the order is entered. Move-out timing is discussed with the buyer's counsel. Where an appeal is being considered, the stay and bond question is addressed at the same time, not after the property has been transferred.

The confirmation hearing, in short

The confirmation hearing is the court's last scheduled review before the sale becomes final. The statute gives four reasons a judge can refuse to approve a sale, and McCluskey makes clear that the hearing is not a second chance to raise defenses that could have been raised before judgment. What it does examine is whether the sale itself was noticed and conducted properly, whether its terms were fair, and whether something the lender or servicer did kept the homeowner from protecting the property. Those questions are answered from documents, and the documents have to be gathered before the hearing date.

If a foreclosure sale has been held on your home in Cook, DuPage or Will County, or a motion for an order approving sale has been filed, Rai Law, LLC can review the report of sale, the notices and the servicing record, and discuss what issues, if any, the file raises and what deadlines apply. You can reach us through our contact page.

This article describes Illinois foreclosure procedure in general terms. It is not legal advice about any particular case, and reading it does not create an attorney-client relationship.