Local News Stories Provide Real Data on Increasing Foreclosures

You Just Can’t Hide It: Until the market and the judiciary gets real about these mortgages, foreclosures will continue to skyrocket, people will walk away from their homes, and the demand for alternative housing needs will skyrocket as well — which might be the underlying reason why nobody wants to do principal reduction and solve the problem.

Throwing millions of people out of their homes creates a false “demand” for lower income housing. The supply of such housing is currently drying up. So the excuse for building newer and cheaper housing and renting them at a profit or selling them at higher and higher interest rates results in an incentive to maintain the status quo. The status quo in this case is a movement to throw as many people out on the street as possible.

Foreclosures keep climbing in Wisconsin

BY JOHN KREROWICZjkrerowicz@kenoshanews.comThe number of property owners landing in court because they’re behind on mortgage payments has jumped for the fourth year in a row in Kenosha County.

Foreclosure lawsuits filed in Circuit Court in 2009 reached 1,352, up 29 percent from the year before. The figure is almost triple the number from 2005, when it was 505.

High foreclosures rates often have detrimental effects on communities, according to various studies. Neighborhoods with an excessive list of foreclosed properties often have more crime; credit scores for borrowers in foreclosure often drop; homelessness might increase, and property tax income for municipalities can fall.

Kenosha County’s jump in foreclosures last year has created a greater workload for the Sheriff’s Department, which handles posting of properties to be sold at auction, oversees the auction and helps keep the peace at sites where owners are being evicted, officials said. Deputies conduct a sheriff’s auction of the properties every Wednesday at the county courthouse.

Experts have said the growing roster of those defaulting on loan repayments is tied to more people being unemployed, drained savings and subprime loan failures.

Foreclosures here grew to 605 in 2006, a 20 percent hike; to 821 in 2007, a 36 percent jump, and to 1,050 in 2008, a 28 percent increase.

Foreclosures usually start with lenders sending a notice that the borrower defaulted on the loan. If payments aren’t arranged, the lender could file a lawsuit to foreclose on the mortgage. When a judge grants foreclosure, the property is sold by auction and proceeds are used to pay off the loan.

When no one buys the property, the lender owns it.

Kenosha Sheriff Sgt. Gil Benn said foreclosure postings — properties being auctioned — skyrocketed from 493 in 2007 to 772 in 2008 and to 1,266 in 2009. That’s a 157 percent jump in two years.

“We’ve already gotten significant entries for 2010, and I see us maintaining the numbers we’ve done,” he said.

Benn said the type of evictions also has changed. He said they used to involve apartment dwellers and a few furnishings but now are more likely to be houses and all their contents.

Benn said foreclosure-related work is being spread among Sheriff’s Department personnel. A home’s new owner pays for a deputy to oversee the move and for the movers. There also are fees for a deputy to deliver legal papers involved.

9 Responses

  1. Wow, there is a great comment above.

  2. Now you begin to see what we’re all really up against; not only corrupt banks and lenders, but equally corrupt lawyers and judges. I saw it myself first-hand in my case, as well as dozens of others I know. Welcome to the new USSA.

    Steve
    99Libra@gmail.com

  3. I’m so glad for this site! Used kar guy AMEN…They NEED TO BE OFF THE BENCH!!! No fairness, or impartiality for anyone!

    I refused to give up a veh a cpl of yrs ago bcuz of a corrupt atty and bk judge. Figured out my old emplyr who lied is two of the top trustees nationally and getting nailed right and left for false docs…Judges are aiding and abetting fraud upon the court by officers of the court its just obnoxious!

    I tried and tried to get sme-1 to listen to me…Now its CRIMINAL CHARGES FOR CORRUPT ATTYS AND JUDGES! Unfortuantely, there aren’t many that’ll go up against CORRUPT OFFICIALS and the correct paperwork necessary I’m baffled with anymore.

    After two recusals for trying to tell the truth what the hell are u suppose to do? Their WRONG THEY KNOW IT…they’ll ENDORSE IT ANYWAY…

    I understand INDEPENDENCE in a JUDICIARY.. However, to be JUDGED UNFAIRLY TO ONES MEANS OFF THE BENCH FOR ALL…Trust me! They are helping steal homes!

    Now ??? if I’m so FRIVIOLOUS? Why RECUSE? tHEY RAN…NARS, 1ST AMERICAN TITLE AND THE JUDGES…

    WHERE ARE THE REAL BANKERS? Doesn’t seem there are any left! That’s the issue! All for them bs has to go!

  4. What about the ever growing inventory sitting on the market, who will purchase those properties which in fact are now due to the decline in valuation, in fact now moderate to low income housing.

    Agree that the Builder’s & the “Smart Growth” advocates, really one & the same have been working every angle of this “Great Recession- Depression”, to insure that the government funding/ PILOTS/Tax abatements keep their industry afloat. Like everyone else here in America, their time has come to learn new skill’s and join “the new world order” so to speak.

    First hand have witnessed the calamity that Professor McCoy saw in her hometown, hundreds of millions of federal & state dollars have been put into “downtown revitalization” here in the North East. In effect giving local and county governments a free pass at being held accountable to the communities they serve. Their job was made easy, bring home pork, with the help of Builder/Smart Growth lobbyists, that the taxpayers flipped the bill for and get re-elected.

    It should be noted that most of these communities were the first experiments in “Urban Renewal” back in the 70’s,(which cost taxpayers a pretty penny back then as well) that in fact destroyed the fabric of once vibrant communities. 30 years later Urban Renewal is now called “Smart Growth”.

    In any-case what is happening in Wisconsin, will and is rapidly expanding to every corner of this country. If in fact as the commentator points out that the effort is to build new and cheaper housing, then one just need to look back into the not so distance past to see how that worked for communities and the financial independance of low to moderate income neighborhoods in America. Not what one could call “Smart Growth”.

  5. VG Diaz- another site you could check for your trust is ABSNET. I don’t know if a free trial is available any more, I found the trust for my 2nd property, SNMLT 2005-2 on the site, called one of the sales reps, he got right to the loans section and told me the the page read “intentianally left blank”. “That’s odd”, he said. And that is as far as I got. But give it a shot. Good luck.

  6. Neil Your Finally starting to see the Real Agenda of the current people in power. It’s kind of like a Reverse Robin Hood Strategy (steal from the hard working poor ie middle class and give it all to the rich) all the while keeping prices high as way to ensure only rich pricks will afford to buy and creating a supply and demand insentive to build more section 8 housing so they have a place to stuff the newly homeless and freshly robbed American Citizens it’s what they probably coin as some thing like “Economic Condensing”.

  7. Law Professor One of Nation’s Leading Experts on Subprime Lending

    News by Topic: Faculty & Staff, Politics & Law
    By: Michael Kirk
    Patricia McCoy, George J. and Helen M. England Professor of Law. Photo supplied by the School of Law

    Patricia McCoy, George J. and Helen M. England Professor of Law. Photo supplied by the School of Law

    When Patricia McCoy was a law professor in Cleveland, Ohio in the 1990s, each day she drove through a neighborhood called Hough that was changing before her eyes. Once stricken by poverty and riots and long-sullied by empty storefronts and ramshackle homes, it began undergoing a transformation, thanks to new public and private investment in the area.

    Uninhabitable homes were being razed, new buildings were under construction, and businesses were opening.

    “There was a real sense of pride in the neighborhood,” says McCoy, now a professor at the UConn Law School and a specialist in banking and securities regulation.

    But before long, she began hearing reports that some of these new homes were already in foreclosure – only a short time after new residents bought them.

    “I wondered why a lender would make a loan to somebody who was so likely to go into foreclosure,” she recalls. “I started to fear that the turnaround was fragile.”

    She suspected there was a double standard when it came to lending: while the more affluent were offered legitimate loans, poorer people were being offered predatory terms many did not fully understand and could not afford.

    “I saw that there was a very serious issue regarding how banking affected ordinary people, particularly those of modest means,” she says. “My Cleveland colleague, Kathleen Engel, and I were disturbed and felt we had to get to the bottom of subprime lending, beginning in late 1999 and 2000.”

    While she did not predict the global enormity of its implications, she knew that sort of risky lending spelled trouble down the road.

    What McCoy was seeing was the beginnings of the subprime lending crisis that would eventually lead to the collapse of the U.S. economy and world financial markets in the fall of 2008.

    McCoy is now regarded as one of the nation’s leading legal experts on the subprime crisis and has been sought out for analysis by publications like The Wall Street Journal and The Economist.

    She was also one of the experts advising the presidential campaign of Barack Obama, and has continued to advise the transition team on current and emerging issues and policy options to deal with them.

    “We were encouraged to have a diversity of ideas and a very vigorous debate,” she says.
    Roots of the Problem

    McCoy believes the crisis was far from unforeseeable. She says it was very clear from the data that the problems she saw in Cleveland were happening elsewhere.

    At that time, however, the subprime market was relatively small. Subprime loans mushroomed between 2003 and 2007. What went from being highly risky in 2003 snowballed in the next five years to being totally unsustainable, she says.

    McCoy identifies two main sources of blame: “One consists of lenders and Wall Street: Wall Street manufactured artificial demand for subprime loans because investors could make a high rate of return, and lenders slashed their underwriting standards to provide the volume of loans that Wall Street wanted.”

    She says the second source of blame is the federal government.

    Although Congress severely deregulated mortgages in the 1980s, federal regulators still had a lot of tools at their disposal to stop lax underwriting, she says.

    “They knew what was going on in ’05 and failed to stop it.”

    She says part of the reason may be that banks are essentially allowed to shop around for their own regulators, and agencies would soft-pedal their regulations to keep the banks from going elsewhere.

    The Federal Reserve System – one of the entities now scrambling to keep the U.S. economy afloat – also bears responsibility, she says: “With the Fed, it was ideological. The big expansion of subprime lending happened under Alan Greenspan, who felt boom-and-bust economies led to greater growth.”

    McCoy saw this up close: from 2002 until 2004, she served on the Consumer Advisory Council of the Federal Reserve Board of Governors, and chaired the Council’s Consumer Credit Committee.

    “I was able to observe first hand the vacillation of the Fed about what to do with subprime loans,” she says.

    Despite protracted discussions with the Fed’s staff and governors, she adds, “it was very difficult to get any movement.”
    Evaluating the Response

    McCoy is generally supportive of the response the Treasury Department and Congress have taken to the crisis. She believes the management of the federal bailout – known as TARP (Troubled Assets Relief Program) – has been highly problematic, but it has also been important: in order for banks to start lending again, they needed to have higher capital.

    She is disappointed that the portion of TARP designed to buy troubled assets has not worked.

    “We have a huge number of distressed borrowers, our foreclosure rates continue to spiral upwards, and that’s going to get worse unless we get serious about providing realistic relief,” she says. “That’s going to require a radical government law that abrogates mortgage or servicing contracts.”

    She’s not sure whether Congress has the stomach for that. But some relief may be in sight with a proposal in Congress to allow bankruptcy judges to cut the principal on distressed debtors’ home loans.

    For the future, McCoy sees room for “modest optimism,” but rates the odds that the economy will improve rather than slide deeper into recession or depression because of the housing crisis at only 50-50.

    “Until we stop having so many foreclosed houses dumped on the market, prices will continue to drop,” she says. “If we can salvage more homeowners, the housing market will bottom out and start to go up again.”

    Together with Kathleen Engel, her longtime co-author, McCoy is writing a book on the crisis for Oxford University Press. She has also worked with UConn economics professor Stephen Ross on subprime research.

    She is now focused on finding ways to address the massive flaws that the housing crisis has exposed in the U.S. financial, economic, and regulatory systems.

  8. You need to put this fat bastard on youtube…

  9. Hey! Nice to see a little local news on the blog. The Kenosha County Judiciary is oblivious (by choice) to the plight of local residents being foreclosed upon. We sat in Judge Bruce Schroeder’s courtroom and listened to him taking “phone-in” appearances from foreclosure mill attorneys (Gray and Associates) and summarily granting a judgment of foreclosure without any concern for residents. There was a gentleman in his seventies who stated that he had refinanced his home of 40 years to get a little money to pay his medical bills. “Judge, I’ve had three brain surgeries and a stroke in the last year, and I just don’t know what happened.” The good Judge Schroeder was unmoved. This is a state that allows judges to receive campaign donations in their chambers.
    This fat bastard Schroeder was also kind enough to call us “liars” at our first hearing. He refused to hear any of our motions and granted summary judgment to HSBC/Wells without blinking an eye. And I used to think CHICAGO was corrupt.

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