AHN News Writer
August 22, 2008 8:12 a.m.
Chicago, IL (AHN) – Mortgage lenders are ending up with more white elephants on their hands as auctions in the Chicago area fail to dispose foreclosed properties.
With no interested buyers, foreclosed units attract vandals and burglars, become shoddy due to lack of maintenance and eventually cause property values in the area to decline further.
In the Chicago area, according to the Woodstock Institute, foreclosed filings that were up for auction went up 98 percent between 2006 and 2007, while for the same period foreclosure filings climbed up only 32 percent.
This negative trend is expected to continue for the rest of 2008, Woodstock said.
Lee Deuben from the Chicago Metropolitan Agency for Planning told the Chicago Tribune, "REOs (or lender owned properties) often leave municipalities guessing about who actually owns the building because of title issues, how long these buildings will remain vacant, and what strains they might put on municipal services and revenues."
The unattractiveness of foreclosed homes to third-party investors is reflected in a Woodstock report to be released which shows Chicago-area auctions which went into foreclosure increased to 94 percent in 2007 from 70 percent in 2005, while third party acquisitions declined to 6 percent in 2007 from 29.5 percent in 2005.
educational purposes (and other related purposes). If you wish to use
this copyrighted material for purposes of your own that go beyond "fair
use," you must obtain permission from the copyright owner. Please
contact Woodstock Institute for more information.