Last Friday, the Chicago Tribune reported that Illinois will be one of the last states to recover from the housing crisis. This estimate is based on the National Association of Home Builders’ recent predictions. Our Oak Park mortgage foreclosure attorneys know that many homeowners, as well as prospective homeowners, still have concerns about the housing market. Many Illinois residents are concerned because their mortgages are underwater (i.e. the amount owed on the mortgage exceeds the value of the home) or because they simply cannot keep up with housing payments, which could put them in danger of facing Chicago mortgage foreclosure.
According to the Chicago Tribune, the problem with the Chicago housing market is jobs. Unlike other struggling states where overbuilding and “skyrocketing home values” led to the housing crisis, Illinois is still experiencing high levels of unemployment. That means current homeowners likely are struggling to pay their mortgages. It also means that prospective buyers are reluctant to purchase homes because they probably are concerned about job security and long-term financial stability. Therefore, foreclosed homes are sitting vacant, which drives down property values. Unfortunately, it is a situation that does not appear to be getting much better.
This September, Illinois’ unemployment rate rose to 10%, the highest level since August 2010.
The Chicago-Joliet-Naperville area experienced the biggest year-over-year increase in September with a jobless rate of 9.8%, up from 9.3% a year ago. Chicago’s unemployment rate affects the housing market because, as experts explain, home construction growth in a particular state, as well as across the entire country, relies on the estimated 2 million households waiting to purchase homes when they believe the time is right. Believing the time is right not only has a lot to do with feeling secure as an individual, but also with feeling confident in one’s larger economic environment.
There is some good news. The National Association of Home Builders’ forecast revealed that the consumers who are buying are purchasing homes that are much more in line with their ability to afford them. According to the news article, consumers typically qualify for and purchase homes that are three times their income. That amount swelled to an unsustainable five times a consumer’s income during the bubble years. Due to lower home values and tight credit underwriting, those numbers are back down to more realistic levels.
Of course, lower home prices do not necessarily help those who are currently struggling and might be facing foreclosure. Unfortunately, many Chicago homeowners do not reach out for help, often because they feel overwhelmed or fear that their situation is hopeless. Yet seeking assistance from a legal professional can help ease your worries and get you back on the track toward financial stability. Homeowners should not give up because there are many foreclosure defense options available. Illinois foreclosure law is changing all the time, so it is essential for Chicagoland residents to be aware of all of the resources available to them. Please consider contacting the Chicago mortgage foreclosure lawyers at the Emerson Firm for a free consultation today.
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