Chicago foreclosure completions down 51% as pipeline clogs (Housing Wire)

By Kerry Curry

September 23, 2011

 

Foreclosure cases are taking longer to complete in Chicago while auctions are decreasing, according to data released this week from the Woodstock Institute.

 

The result is a 51% drop in foreclosure completions during the first six months of this year compared to the first half of 2010.

 

In the six-county region, 8,515 cases completed the foreclosure process at auction in the first half, down from 17,331 a year earlier.

 

In the first half of 2011, declines occurred in all six counties when compared to the year ago, with the steepest declines in auction activity in Lake County, which had a 55.2% drop, and Cook County at 55.1%.

 

The research organization said completed foreclosure auctions in the second quarter fell to the lowest level since the beginning of the housing crisis, dropping 26% from the first quarter. In the six-county region, only 3,604 properties completed the foreclosure process in second quarter — fewer than any other quarter since 2007.

 

Longer foreclosure process times have contributed to the declines in auctions.

 

For cases in the Chicago region that completed the foreclosure auction process during the second quarter, the median length was 359 days , which is the highest since 2008.

 

The length of the foreclosure process is heavily influenced by the share of regional cases completing in Cook County, the nation's second most populated county, which accounts for more than 60% of all completed cases in the region.

 

It took 363 days to process foreclosure cases in Cook County in the second quarter.

 

The Woodstock Institute said the minimum timeline is 261 days, but that rises when there are defendant motions, bankruptcy issues or other factors.

 

The firm attributed the longer foreclosure timelines to the legacy of the robo-signing scandal. Trends in the first half were a continuation of regional declines first observed in the fourth quarter when the robo-signing issues broke and the resulting moratoria was implemented to correct improper document processing by mortgage servicers.

 

As of the end of the second quarter, Illinois with 7% of loans in foreclosure was one of four states with the highest percentage of loans serviced that are currently in the foreclosure inventory.

 

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