Chicago Foreclosures Show No Sign of Slowing
May 3rd, 2010 categories: Economic Recovery, Foreclosures, Housing Market
The Chicago area has been particularly hard hit by housing foreclosures lately. And the numbers indicate that this trend is far from over.
According to a recent report by the Woodstock Institute, more homeowners in the Chicago area lost their residences to foreclosure in the first three months of this year than they had in any quarter during the last five years.
The Chicago Tribune covered this news late last week. And, yes, reading the story was a depressing experience.
That’s because foreclosures don’t help anyone. A family is out of their home. A bank or lender is stuck with a property it’d rather not have to sell. And neighborhood housing values take a hit. These are the three big effects of housing foreclosures.
According to the Tribune story, 9,302 homes went through a court-ordered auction in the six-county Chicago region during the first quarter of this year. This is significant because auctions are the last step in the foreclosure process. Of the homes that reached this step, lenders took back 95 percent.
In the city of Chicago itself, nearly 3,500 homes went to auction. Lenders again took back 95 percent of these residences.
The foreclosure numbers are depressing, but they shouldn’t be surprising. The recession hit Chicago, as it did most cities in the country, hard. Unemployment here stood at a far-too-high 11.5 percent in March, above the national average. When people are out of work, or when they see their annual incomes slashed, they struggle to pay their mortgage bills. Eventually they default on their loans, entering the foreclosure process.
There is hope for homeowners, though. If you are struggling to pay your mortgage each month immediately call your lender or bank. Tell a mortgage specialist there that you are struggling to make your payments and that you fear you’ll soon start falling behind. Remember, your bank doesn’t want you to lose your house to foreclosure. It should be motivated to do something – such as lowering your loan’s interest rate or lengthening its terms – to make your mortgage payment more affordable.
The worst thing you can do, and the one thing that will certainly add you to the soaring number of Chicago homeowners facing foreclosure, is to do nothing. You can’t hide from foreclosure; you need to call your lender.
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