Homebuyers and a real estate investors can save a lot of money buying a property in a short sale.  The savings can be significant:  in the tens of thousands of dollars.  While this savings can be a tremendous financial advantage, it is important to remember that the buyer will earn this savings and must be prepared for the obstacles posed by a short sale.

In a short sale, the lienholders to a property agree to settle for less than the face value of the debt secured by the property.  That is a fancy way of saying everyone with a claim on the property agrees to come up short [hence the name, ‘short sale’].  It is important to understand that “everyone” includes more than just the bank holding the mortgage:  it can include contractors whose work on the property went unpaid, utility companies, the IRS, homeowners associations and judgment creditors.  You must remember that the reason a homeowner attempts a short sale is that they are in financial difficulty and such a person rarely has difficulty with only one debt. 

Because of the nature of a short sale, it should not surprise anyone that they can take a long time, as there are many parties other than the buyer and seller who must agree to the transaction.  Even when the primary mortgage lender provides a relatively quick approval, there may be delays.  The seller may not have much ready cash.  If the seller is expecting the transaction to take several months and then discovers they must find a place to rent and come up with a security deposit and rent on short notice there may be a delay while the seller gathers the necessary funds.

These situations can pose obstacles to buying a property in a short sale, but they can be overcome with a little preparation.  An informed and prepared buyer can save a lot of money on a home or rental property by purchasing it in a short sale. 

If you are considering purchasing a property in a short sale here are some things you should do:

·       Understand that this transaction may involve several months of waiting and then suddenly require you to be ready to close within 30 days.

·       Ask your real estate broker and attorney how many short sales they have negotiated and closed in the last 12 months.  If the answer is a single digit number, consider using a more experienced broker/attorney. 

·       Ask the Seller [this is usually done through your attorney] how long they will require to move out and how much they have set aside for a security deposit.

·       Ask for the Seller’s utility bills as part of your inspection/due diligence process.  Most buyers ask about 2nd mortgages and contractor liens but then are surprised when past due utility bills delay a closing.

·       Contact The Ratowitz Law Group at 312 577-9405, or


Given the recent upheavals in the medical insurance industry, a growing number of consumers are forced to negotiate their own medical bills.  This can be a daunting prospect because most of us are not involved with the high-level price negotiations that take place between large medical corporations and the public and private insurance entities.  Further complicating a consumer’s ability to understand the costs of their own healthcare are:


·       the common practice of forcing consumers to sign a waiver in which they also agree to pay whatever is charged for a service regardless of whether their insurance fully covers that service;  

·       the practice of obtaining a patient’s consent without disclosing the price charged for a procedure or test, or the opportunity to consult with the patient’s medical insurer; and

·       the complexity of medical bills which are often filled with words, acronyms and codes with which most of us are unfamiliar.



If you are being asked to pay a portion of your medical bills not covered by insurance and you live in Illinois you may have some recourse.  At The Ratowitz Law Group we are here to help.  I urge you to read on and, if you feel this may describe your situation contact me for a free consultation and we’ll analyze your situation together.

Many large healthcare providers negotiate special pricing contracts with insurance companies.  These are often called Facility Participation Agreements [FPA’s], although they go by many other names.  In these agreements, the provider and insurer agree on specific prices for specific services.  Many of these contracts require the provider agree not to charge the insured individual above and beyond the price agreed upon in the contract.  In other words:  if the provider charges $400 for a test, but the FPA specifies the insurer will pay $300 for that test, the provider agrees they will not charge the insured individual the remaining $100.  In many cases, however, the medical provider accepts the $300 from the insurance company and then sends a bill to the patient for that remaining $100. 

If you have had medical treatment and your insurance paid for a portion of that treatment but your provider is demanding that you pay the rest, you should ask if they have an FPA or any other type of agreement with your insurer that covers pricing.  Ask to see that agreement – or better yet, bring that agreement to me:  I’m happy to read it for you.  Together we can determine whether or not you’ve been overcharged and then discuss the best course of action to take.

Contact me by email at or call 312 577-9405.


Bankruptcy or Debt Settlement

Clients often ask my advice on whether they should pursue “debt settlement” or “debt relief” in order to avoid bankruptcy.  The simple answer to this is:  “NO!”  Debt settlement rarely achieves the client’s goal of resolving their debt problems.  In most cases, debt settlement fails to resolve all debts and leaves the client’s credit rating worse off than before.

Debt Relief or Bankruptcy?

Debt Relief or Bankruptcy?

To understand why, it is necessary to understand how debt settlement works and how debt settlement companies operate.  Debt settlement is essentially the process of negotiating a debt repayment program with every single creditor, one at a time.  Debt settlement companies will often appear to make this simple by having the debtor pay them one monthly payment which they then split up amongst all of the creditors, keeping a portion of each monthly payment as a fee.  This seems convenient for the debtor:  one monthly payment and all their debts are resolved.  Unfortunately this almost never works due to problems inherent in the debt settlement process.

One of these problems is what I will politely call the unreliability of the debt settlement industry.  If you google:  “debt settlement scams” you will understand what I mean.  There are probably many debt settlement companies that are sincere and professional, however there are many, many other debt settlement companies that are not.  Perhaps more importantly, there is no reliable way for a consumer to determine if the debt settlement company they are dealing with is responsible or not.  Hiring a debt settlement company can be a gamble, and a bad bet at that:  maybe you hire a scam company that takes your money and does nothing, maybe you hire a reputable company that takes your money and doesn’t accomplish what you thought they would.

Even a responsible debt settlement company will rarely be able to help a debtor.  This is because creditors are not required to participate in debt settlement and many will refuse to do so.  This means that the debtor will [often unknowingly] only settle some of their debts.  Because debt settlement will have the debtor stop paying their debts, all of their creditors will report delinquent payments to the credit bureaus, but only some of them will report settlements.  Worse still, because debt settlement occurs over a lengthy period, the debtor will have many negative reports on their credit covering a large period of time. 

Bankruptcy will resolve all debts and will only appear on your credit once.  Unlike debt settlement, creditors are required by law to participate in bankruptcy and face severe penalties if they refuse.  With very few exceptions [see below], bankruptcy will resolve all debts either with a discharge [in a Chapter 7] or a combination of partial payment and discharge [Chapter 13].  The fees for bankruptcies are supervised by the Bankruptcy Courts and are almost always less than debt settlement companies charge.  A Chapter 7 bankruptcy is a fairly quick and simple process that does not require any payments from the debtor.  A Chapter 13 bankruptcy only requires partial payments of certain types of debt and, unlike with debt settlement, those payments, and their dispersal to creditors is supervised by the Bankruptcy Court and the debtor has certainty that they payments are being applied in the expected manner.

Because bankruptcy provides a debtor with certainty and a complete solution at a lower cost to the debtor than debt settlement, and because bankruptcy generally involves fewer negative reports on the debtor's credit, I never recommend debt settlement as a way of avoiding bankruptcy.  Use bankruptcy to solve your debt problems and avoid debt settlement.  

Call 312.577.9405 ext. 88 or complete the form to schedule a consultation.    

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