Foreclosure sales continue to mount
Across the nation, homes facing or already in foreclosure more than doubled in the second quarter from the same period in 2007.
According to a report released last week by RealtyTrac, an online marketplace for foreclosure properties, 739,714 properties in the United States were in a form of foreclosure during the second quarter of 2008. That means one in every 171 American households is facing the possibility of losing their home.
For the first quarter of 2008, 3.72 percent of all outstanding home loans in Indiana were in foreclosure, while 7.05 percent of loans were delinquent, according to the Mortgage Bankers Association. Those figures put Indiana fourth in the nation for foreclosures, behind only Florida, Nevada and Ohio.
Indiana had 5,057 foreclosure filings in April, pushing the yearly total to 21,684 (one in every 198 households). That number is down a third of a percent from the first quarter, but up 59.4 percent from the second quarter of 2007.
Leading the way in April was Marion County with 1,938 filings. In a distant second was Lake County with 661, and Allen County in third with 473. Washington County had 14 listings, Floyd County had 10 and Crawford County had six.
Harrison County’s numbers are on the rise as well.
In Harrison County, there were only two foreclosures filed in April. However, yearly foreclosure sales conducted through the sheriff’s office are still slightly ahead of last year’s pace.
For all of 2007, there were 87 sales in the county totaling $7,811,357.78 worth of property. Through the end of July, there have been 41 sales totaling $3,792,613.39.
Foreclosure sales in Harrison County grew at a minimal pace in the early part of this decade with about $5 million worth of sales in 2003 and $5.1 million in 2004. The number climbed to $5.8 million in 2005 and ballooned to $6.2 million in 2006.
Carolyn Creal, office manager for the Harrison County Sheriff’s Dept., said she believes the blame lays on both sides of the home-purchase equation.
‘You have younger people out there who just don’t understand what an adjustable rate is. They look at their rate and think it’s really good, but they don’t consider what happens when that rate goes up,’ Creal said. ‘They could start out with a $600 a month payment and then it could jump up a couple of hundred dollars. If they are living paycheck to paycheck like a lot of people, that could really set the stage for a foreclosure.
‘Then on the other side, you have a lot of these mortgage companies offering homes with no down payment and they try to make it easy to acquire a home, but either they don’t watch who they are lending to, or they push the adjustable rate mortgage and the next thing you know, the homeowner is in a foreclosure. Most local banks require a down payment, so that’s why they haven’t been hit with foreclosures.’
Creal said most of the foreclosures in the county’s sheriff’s sales come from nationwide lenders like Countrywide, US Bank, Mortgage Electronic, Deusche Bank and Citibank.
‘Farmers State Bank and First Harrison Bank have had a couple between them, but the sheriff’s sale usually involves the bigger chains that are nationwide,’ Creal said.
The process of selling foreclosed property starts after a judgment of foreclosure is delivered to the sheriff’s office and the county clerk’s office. From there, Creal gets a praecipe for the sheriff’s sale. Once she has the summons and judgment of foreclosure in hand, and she receives a sale notice from an attorney’s office, she can set the date for the sale, which must be advertised three times in a newspaper.
‘The mortgage companies have the opening bid, but all someone has to do is bid $1 more than the asking price (usually the amount owed on the property) and they can purchase the home. The only thing we require is a letter of credit from the bidder’s bank,’ Creal said.
If a property doesn’t sell, then it’s turned over to the bank. The sheriff’s office requires payment in full by 4 p.m. the day after the sale.
‘Sometimes we’ll have a property listed; however, it doesn’t go to sale because the homeowner settled with the lender or a lot of them get canceled because the property owner might file bankruptcy,’ Creal added.