“Now that some of the legal questions surrounding foreclosure processes have been resolved through the settlement with state Attorneys General, servicers are again completing foreclosures in large numbers,” said Spencer Cowan, Vice President of Research at Woodstock Institute. “The number of auctions is at a level not seen since its peak in 2010 before the robosigning scandal broke.”
“Increasing numbers of foreclosure auctions, the vast majority of which become bank-owned and likely vacant, often contribute to neighborhood distress,” Cowan added. “Loan servicers should continue to pursue options to avoid foreclosure whenever possible, including reducing principal on loans when appropriate. When foreclosure cannot be avoided, servicers must ensure that properties are maintained to all standards required by municipalities.”
The data on trends in foreclosure filings and auctions in the Chicago six county region in the first half of 2012 show that:
• Completed foreclosure auctions grew substantially from the first half of 2011 to the first half of 2012. Foreclosure auctions grew by 104.7 percent from 8,515 auctions in the first half of 2011 to 17,432 auctions in the first half of 2012.
o Lake County saw the biggest increase in auctions of all six counties, with auctions growing 158.2 percent from the first half of 2011 to the first half of 2012. Will County experienced a 77.2 percent increase in auctions over the same time period—the smallest increase of all six counties.
o From the first half of 2011 to the first half of 2012, auctions grew by 108.6 percent in Cook County and by 87.7 percent in the City of Chicago.
o Within the City of Chicago, auctions grew by 132.5 percent in South Lawndale, 120 percent in Chicago Lawn, 118.6 percent in West Ridge, and 109.8 percent in Austin.
o Municipalities that experienced significant growth in auctions from the first half of 2011 to the first half of 2012 include Hoffman Estates (214.3 percent growth), Maywood (188.6 percent), Waukegan (178.4 percent), and Chicago Heights (140.5 percent).
• New foreclosure filings remained relatively flat from the first half of 2011 to the first half of 2012, but significant growth was seen in several low-wealth communities. Chicago region foreclosure filings grew 3.1 percent from 33,934 in the first half of 2011 to 34,9178 in the first half of 2012.
o DuPage County experienced the largest increase in filings of all six counties, growing 17.5 percent from the first half of 2011 to the first half of 2012. Will County saw the biggest decrease of all six counties over the same time period, with filings dropping by 10.2 percent.
o Filings grew by 3.4 percent in Cook County and 1 percent in the City of Chicago from the first half of 2011 to the first half of 2012.
o Within the City of Chicago, filings grew by 58.7 percent in West Pullman, 24.1 percent in Englewood, and 22.4 percent in Roseland from the first half of 2011 to the first half of 2012. All of these community areas experienced declines in foreclosure filings from 2009 to 2011.
o Several Chicago region municipalities experienced growth in new foreclosure filings, including Dolton (27.4 percent growth), Rolling Meadows (25 percent), and Calumet City (24.8 percent growth). All of these municipalities experienced declines in new foreclosure filings from 2010 to 2011.
“While new foreclosure filings are generally stabilizing at elevated levels, several low-wealth communities which have recently experienced declines in new foreclosure filings are again seeing increases in filings,” said Cowan. “This raises concerns about further blight and destabilization in these neighborhoods.”
For more information, please contact Spencer Cowan at 312-368-0310 or scowan at woodstockinst dot org.