We’ve heard that the foreclosure crisis has essentially come to an end—or at least shown signs that the end is near—across the country. However, a recent article in the Chicago Tribune suggested that signs of the foreclosure epidemic remain salient in Chicago neighborhoods and others across the state. What’s the problem? According to the article, Illinois just hasn’t completed enough foreclosures. Indeed, there’s a “backlog of distressed and abandoned properties” in the state that “drags down neighborhoods that can least afford vacancies and blight.”
The presence of abandoned and unsightly properties goes hand-in-hand with Illinois foreclosures, as many homes went into disrepair when their owners couldn’t make monthly mortgage payments. RealtyTrac ranked Illinois as the third worst offender in terms of the number of foreclosures yet to be completed (putting only Florida and California head in the total number of foreclosures). Many Chicago residents want their home values to increase, but that’s not likely to happen if neighborhoods remain blighted by abandoned properties. If you have questions about your rights as a homeowner or a consumer, contact the dedicated foreclosure defense attorneys at the Emerson Law Firm. We have years of experience dealing with the foreclosure crisis in Illinois, and we can answer your questions today.
Vacant Properties and Potential Homebuyers in Chicago
With the economy entering recovery, many Illinois residents are looking to buy homes. Yet abandoned properties that have gone into foreclosure but haven’t been completed aren’t available. Based on recent data from RealtyTrac, Illinois citizens “yearning to buy empty homes” would be better off “if the state completed more foreclosures.” Indeed, according to the article in the Chicago Tribune, the key to real estate recovery doesn’t appear to be avoiding foreclosure. Instead, it’s about getting “these eyesores on the market, so buyers can fix ‘em up or tear ‘em down.”
How bad can it really be? The housing crash happened more than seven years ago, and there are still approximately 18,000 vacant properties in Chicago alone. The Institute for Housing Studies at DePaul University emphasized that, by the end of 2013, more than 18 percent of residences in the Englewood neighborhood “had been unoccupied for at least two years.” More than 9 percent of Humboldt Park residences have been vacant for more than two years, and 8.5 percent of homes in Austin have met this “two-year vacancy rate.” Poorer suburbs report similar numbers, with a 9.1 percent vacancy rate for residential properties in towns in south Cook County where residents make up lower socioeconomic brackets. The Chicago Tribune put it starkly: “Those properties sit, rotting.”
Yet it’s important to note that the problem is not rampant in wealthier areas of Chicago and in wealthier suburbs. The Loop, Near North, and Lincoln Park appear to be doing just fine. In those neighborhoods, along with suburbs like Winnetka, “housing has staged a comeback amid strong demand.”
What’s Causing the Foreclosure Backlog?
A couple of explanations exist for the Illinois foreclosure backlog. First, while recent Illinois legislation intended to speed up the foreclosure process, it might actually have slowed it down in the short term since lenders and servicers need time to adjust to such changes.
Some commentators believe the slowdown is a result of Attorney General Madigan’s lawsuit against Safeguard Properties, a firm that “lenders use to secure buildings in foreclosure.” Others believe the rising number of short-sales might be a cause, while still others wonder if banks’ efforts to prevent foreclosures are resulting only in abandoned, decrepit properties.
If you have questions about how the foreclosure crisis might affect your chances to sell or buy a home in the Chicago area, contact an experienced Illinois real estate attorney today.
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