Mountains of Foreclosures

January 24th, 2008 | Tags: Foreclosure

After the record breaking foreclosure statistics of 2007 Milwaukee county is already seeing 1,000 units scheduled for auction during the first 9 weeks of 2008. Earlier this month in one day 200 have been put up for sale. Foreclosures are breaking its own records. During 2007 there had been auction of 2,800 units – a 60% rise over 2006. In 2008 the skies are threatening. Already 1,000 docket numbers have been issued for this year and others are waiting in line to register for March auctions.

Although the entire suburbs have been hit the worst affected is Milwaukee with 87% of those going for auction coming from the city itself. The sale price figures are misleading because of three years of pending taxes, penalties for code violations and extensive repair expenses.

Not all the listed properties make it to the auction sale because some borrowers file bankruptcies. In this case the step is postponed for some months. In other instances the borrower sometimes manages to sell the property and cancel the judicial process of foreclosure. The condition of the real estate market is pathetic with hardly any buyers. About 92% of those that have made it to the auction are bought off by the lenders.

Mayor of Milwaukee Tom Barrett has been working in tandem with state and national official to mitigate the problem. The city has allied with non-profit groups to spread financial awareness amongst the people and help the traumatized borrowers either facing foreclosures or about to do so. Barrett gloomily predicts that the worst is yet to come. The Attorney General Grant Langley is thinking of filing law suits (following examples set by Baltimore and Cleveland) against lenders for discrimination against minorities.

The vacant homes are telling on the real estate market with prices falling in the entire region. Vacant units sell higher but they are targets of high instances of looting and plunder. With these becoming criminal dens the entire block is besmeared with the slime. Previously properties were sold within 90 days but today the house may remain unsold even after 180 days despite the price being 25% lower than market value. The banks are abandoning units when they cannot sell it because of unpaid taxes and city penalty charges for breaking of building codes. On the other hand the municipality cannot foreclose on the bank for unpaid taxes until a lapse of three years.

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