Home foreclosures are at the heart of the economic crisis in America. Falling values of real estate and mortgage-backed securities have wrought havoc with the nation’s financial sector and brought some of the worlds biggest companies to their knees.

More foreclosures threaten to worsen the country's already-struggling economy, and that's why Illinois lawmakers are taking an important step to address the situation:

[Gov. Pat] Quinn called the legislation an important step in addressing the crisis that has swept Chicago, the state and country.

The new law gives homeowners extra time to work with lenders, by prohibiting foreclosures in the first 30 days of delinquency.

Lenders must tell homeowners they have another 30 days to work with a credit counselor—and give them yet another 30 days if they see a credit counselor approved by the U.S. Department of Housing and Urban Development.

The new regulation allows a total grace period of 90 days for struggling homeowners – enough time to find a new job, seek help from a credit counselor, or find some other way to make ends meet.

Democratic House Speaker Michael Madigan believes the 90-day window will help many homeowners get out from under crushing debts imposed by predatory lenders:

"This is really a continuing struggle," Madigan said. "A continuing battle against people who don't care about neighborhoods. Their only concern is to make money."

Madigan added: "Let the word go out to predatory lenders—don't come back."

In a state as hard-hit by foreclosures as Illinois (Cook County has seen foreclosures more than double in the last 2 years), the law provides a good test of how this kind of policy will effect banks and homeowners alike. If the policy is a success, we might see it replicated in other states or at the federal level, where Congress is already considering other plans to reduce foreclosures.