Buying a House After Foreclosure

As the housing market continues to recover and many Americans find themselves back in the position to consider buying a home, it’s important to know the details about buying a house after you’ve had the bank foreclose on your property.  Are you thinking about becoming an Illinois homeowner, either for the first time or after a foreclosure?  A recent article in the Chicago Tribune ran a story about what it takes to buy a home after foreclosure.  Is it only about credit scores and down payments?  Or is there more to the equation?  These questions are popping up across the country, and their answers will be important for Illinois families who are beginning to think about owning a home—again.

If you’re concerned about what it takes to buy a property after foreclosure, it’s important to speak to an experienced real estate attorney.  The lawyers at the Emerson Law Firm have been helping homeowners and potential homeowners for years, and they can speak to you today.

The Importance of Your Credit Score and Credit Report

In the Chicago Tribune article, a local couple wrote into the newspaper, telling “Real Estate Matters” about their homeownership history.  In short, the couple had lost a home to foreclosure, and now they’re hoping to be eligible to buy again one day in the future.  So what do Illinois homeowners like this couple mentioned in the Chicago Tribune need to know about buying a home after they’ve lost a property to foreclosure?

First, credit histories and credit scores are going to be important.  Since your credit score follows you into a marriage, if you’re currently thinking about buying a property with a spouse or significant other, it will be essential to know what each of your credit histories and credit scores will look like to your lender.  In terms of the key number, the Chicago Tribune’s “Real Estate Matters” says credit scores at 750 or above are ideal for homeownership: “we’d like to see your score in the mid- to upper 700s as you consider buying a home.”  Why?  According to the article, “you’ll have an easier time obtaining a mortgage loan and will obtain a better rate.”  In other words, “in the long run, you’ll save quite a bit of money if you are able to get the best rate possible having a higher credit score.”  The key takeaway when it comes to credit scores and credit reports is this: higher scores result in better rates, which save you money.

It’s a good idea to obtain a copy of your credit report, ensuring that you don’t have any “potentially negative information” that a lender will see.  If you do see negative information, you’ll want to make sure it’s accurate.  If it’s not, you can dispute the information with the credit reporting agency.  However, if the information is accurate, it can lead to high interest rates and, in some cases, the inability to obtain a home loan.

Why You’ll Need a Down Payment

More than your credit score, you’ll want to make sure you have a significant down payment if you want to buy a home.  In some cases, potential homeowners may qualify for special home loans through the U.S. Department of Housing and Urban Development (HUD).  If that’s the case, you might not need a lot of cash for your down payment.  However, if you’re trying to prove to a lender that you’re a serious homebuyer, you’ll want to be able to show that you really understand what it takes to buy a home and make monthly mortgage payments.

In most cases, if you’ve lost a property to foreclosure, you’ll need to work to improve your credit score, and you’ll also want to make sure you have a large cash down payment before you think about entering into another mortgage agreement.  The dedicated attorneys at the Emerson Law Firm have specialized knowledge about the foreclosure process and the real estate market in Illinois.  Contact us today.

See Related Blog Posts:

More Homeowner Support on the Way in Illinois

Why Do Short Sales Take So Long?

Bank of America Accused of Securities Fraud

Just last week, the government filed two lawsuits against Bank of America for securities fraud.  According to the Justice Department, the bank perpetrated “a fraud on investors involving nearly a billion dollars of residential mortgage-backed securities.”  Both the Justice Department and the U.S. Securities and Exchange Commission filed suits in the U.S. District court in Charlotte, according to a report in CNBC Business News.

This news highlights that the housing crisis isn’t over yet.  Many Americans are still feeling the effects, and the government continues to look into possible causes for the real estate collapse.  If you’re at risk of foreclosure, don’t hesitate to contact and experienced foreclosure defense attorney today.

Details of the Government Claim Against Bank of America

When did these crimes allegedly occur?  According to the court filings, the securities go back to around January 2008, which is toward the beginning of the financial crisis and the housing market collapse.  Bank of America has issued statements denying the allegations.  According to a statement published by CNBC, a Bank of America spokesperson said, “these were prime mortgages sold to sophisticated investors who had ample access to the underlying data.”  The bank went on to argue, “we are not responsible for the housing market collapse that caused mortgage loans to default at unprecedented rates and these securities to lose value as a result.”

However, when the Guardian reported on recent news, it made clear that the fraud claims are no small matter.  Indeed, the U.S. government has accused the bank of fraud related to residential mortgage-backed securities worth $850 million.  The lawsuits are coming close on the heels of Bank of America’s $45 billion settlement related to the foreclosure crisis.

The residential mortgage-backed securities are known as BOAMS 2008-A.  According to the Guardian, they were “of a higher credit quality than subprime mortgage bonds,” and they’re “dated to about January 2008,” was which “months after many Wall Street banks first reported billions of dollars in writedowns on their holdings of subprime mortgage securities.”

The lawsuits were filed in Charlotte, NC, where the headquarters of Bank of America are located.  The claims from both the Department of Justice and the U.S. Securities and Exchange Commission argue that Bank of America made “misleading statements” and failed to “disclose important facts about the pool of mortgages underlying a sale of securities to investors in early 2008.”

According to the Justice Department, “these misstatements and omissions concerned the quality and safety of the mortgages collateralizing the BOAMS 2008-A securitization, how it originated those mortgages, and the likelihood that the ‘prime’ loans would perform as expected.”  In its statement surrounding the case, the Justice Department also made clear that the “material number of mortgages in the pool failed to materially adhere to Bank of America’s underwriting standards.”  In other words, both the Department of Justice and the U.S. Securities and Exchange Commission claim that Bank of America employed fraudulent mortgage practices for which they haven’t yet compensated those who were negatively affected.

We’ll have to wait and see if the cases result in more hefty financial settlements from Bank of America.  In the meantime, if you have been negatively affected by bank practices or are at risk of foreclosure in our state, the experienced foreclosure defense lawyers at Emerson Law Firm can discuss your case with you today.

See Related Blog Posts:

New Wells Fargo Foreclosure Settlement

Former Employees Denounce Bank of America Foreclosure Practices

Cook County Approved for $30 Million Sustainable Development Loan

Earlier this year, Antonio R. Riley, the Midwest Regional Administrator for U.S. Housing and Urban Development (HUD) announced that the department approved a $30 million loan guarantee for Cook County “to help finance four types of sustainable developments in the county.”  According to a press release from HUD, the loan will provide funding for a range of Chicago development projects, from small business projects to larger scale transit projects.  HUD defined these sustainable developments specifically as:

·          Transit-oriented, mostly mixed-use development within a half mile of passenger rail

·          Cargo-oriented projects near freight rail lines

·          Mixed-use hospitality/service sector projects near transit lines

·          Business Development loans

HUD hopes that its Section 108 Loan Guarantee Assistance Program will be a “powerful tool to drive economic development” in the Chicago area.  Riley indicated that the approved $30 million in funds will help for-profit businesses in Cook County to carry out a variety of economic development schemes, which will benefit low-income and moderate-income residents in the city.  In fact, Riley stated that the loan “is expected to create 600 new jobs” this year.

What is Sustainable Development in Chicago?

In Cook County’s application to HUD for the funding, it explains that its Department of Planning and Development “will administer this sustainable economic development initiative” and “will provide financing assistance for the economic development projects that qualify.”  Who will qualify under the scheme?  The County will work together with smaller communities and their organizations to determine eligibility for sustainable development projects, and they’ll partner up to “support these job-creating, economic developments.”

In fact, the City of Chicago actually has its very own Sustainable Development Division, which is “responsible for creating and expanding public open space systems” and “developing policies and programs to advance the sustainability of the City’s building, businesses, and urban form.”  This division is part of Chicago’s Department of Housing and Economic Development.

It has some long-term projects underway, which include improvements to waterfront access, initiatives to expand certain natural habitats and to improve the green quality of development sites, and programs to promote the local food industry.  While many of these aren’t the specific kinds of projects that the HUD loan will help to fund, they showcase Chicago’s interest in sustainable development, whether it deals with environmental and agricultural improvements, or transit-related initiatives that will be at the forefront of the $30 million loan.

What is the Section 108 Loan Guarantee Assistance Program?

Section 108 is part of a loan guarantee provision of the Community Development Block Grant (CDBG) program.  It’s intended for communities that are strapped for cash but need money for housing rehab, distressed public facilities, and other large-scale development initiaives.

Aimed at projects like those underway through Chicago’s Sustainable Development Division, the Section 108 Loan Guarantee Assistance Program helps local governments to borrow funds from private investors at interest rates that are reduced from typical loans.  With these lower interest rates, cities like Chicago can use the funds to “promote economic development, stimulate job growth, and improve public facilities.”  The loan program is intended to encourage private contributions and seed money to large-scale public projects in distressed areas.  It is HUD’s hope that the funding provided through this program might be able to “renew entire neighborhoods.”

If you have questions about acquiring a loan to purchase a foreclosure or other property in need of rehabilitation, contact an experienced attorney today.

See Related Blog Posts:

How to Rehab a Home with HUD’s 203(k) Program

Community Organization Seeks to Revitalize Chicago Neighborhoods

Thinking About Buying a Foreclosure?

Are you thinking about investing in a foreclosure?  It’s looking like the real estate market is going to be a bit tougher this year.  Although the Chicago area saw more than 20,000 foreclosures between February of 2012 and 2013, competition for those Illinois properties is likely to increase this year.   If you want to buy a foreclosure, you may need to act quickly.

What’s Driving Prices Up?

According to a recent article in the Chicago Tribune, foreclosures are being listed strategically.  Real estate agents are listing these properties for prices that are far less than the likely final selling price.  This strategy creates bidding wars around the foreclosed homes, driving prices up.  This marketing technique generates wider interest and multiple bids on these properties.

Liz Sidorowicz, a Re/Max Signature real estate agent, described the process as generating a lot of “overbidding.”  She described a client’s bidding process on a “gutted Mount Prospect foreclosure” in which “even the switch plates were missing.”  The house was listed for $350,000.  The client submitted a bid of $421,000—nearly $100,000 more than the asking price—and still “lost out to a higher bid.”

In addition to a shift in the marketing strategy, there are other factors at work.  The slowing rate of foreclosures nationwide, along with falling mortgage rates and increasing home sales, is leading “those once-in-a-lifetime bargains” to fade from the market, according to a report from NBC News.  The supply of these homes is becoming more limited—the housing market is no longer saturated with attractive foreclosed properties.

In other words, the slow rebounding of the housing market is reflected in the diminishing backlog of distressed properties that were once selling at “deep discounts.”  Now, according to a RealtyTrac spokesperson, there’s a noticeable “shortage of inventory.”

Rehabbed Properties More Plentiful Than in Years Past

Another factor that’s affecting the availability of foreclosures for sale is the increasing curb appeal of many of these properties.  While once many areas saw homes in varying states of decay, a lot of these houses “are looking better than they have in years past.”

Why is this?  Some housing advocates suggest that it’s a result of the government’s increased effort to rehab properties before listing them on the market.  For example, the Chicago Tribune reported that Fannie Mae and Freddie Mac are taking greater steps to preserve neighborhoods, hoping to attract owner-occupants instead of people who are only interested in making some money from a rental property.

So in order to make many of these foreclosures attractive, or to fix them up so that they “look like the house next door,” government agencies are providing funds for new paint and carpet, as well as for the installation of new kitchens, furnaces, and other new appliances.  Fannie and Freddie know that they’re not going to attract owner-occupants with completely gutted homes—those are going to be purchased by investors instead.

And relatedly, these improvements are adding to general increased housing prices and availability.  It makes sense that a “fixed-up foreclosure costs far more than one with a long list of repairs needed,” since it “doesn’t carry the problems that come with trying to secure financing for properties that are not in habitable condition.”

But keep in mind, even properties that are still in need of substantial rehab work are “going fast.”  If you have questions about foreclosures and the real estate market in Illinois, contact a licensed attorney today to discuss your concerns.

See Related Blog Posts:

Home Prices Rise, But Can You Find a Seller?

New Law Speeds Up Illinois Foreclosures

Community Organization Seeks to Revitalize Chicago Neighborhoods

The Southwest Organizing Project (SWOP), a nonprofit group committed to community organizing, is striving to reclaim Chicago’s Southwest side.  Its recent community-based campaign, known as “Reclaiming Southwest Chicago,” is seeking funding from the National Foreclosure Settlement Awards in order to rebuild communities that were especially “hard-hit by the housing crisis.”  

A recent article in the Chicago Tribune praised the nonprofit group for its work in our city.  The story emphasized the group’s broad reach in areas negatively affected by foreclosures, and noted that the group was even recognized nationally last month when it received a MacArthur Award for “Creative and Effective Institutions.”  SWOP received the award because of its success in “empowering the community to help itself.”

According to the MacArthur Foundation’s mission statement, it “supports creative people and effective institutions committed to building a more just, verdant, and peaceful world.”  Among the Foundation’s many emphases, it works to “make cities better places,” which is precisely what SWOP is hoping to do for Chicago.

History of the Community Group

SWOP describes itself as a group designed to improve neighborhood life and well-being in certain Chicago communities.  In the past fifty years, the Southwest side has seen “large and rapid demographic shifts” that have led to a breakdown of neighborhood networks in the area, and a declining sense of community.

The Southwest Organizing Project’s early work began in 1989 through funding from the Southwest Catholic Cluster Project.  These early efforts were intended to strengthen community bonds among the “increasingly diverse residents and neighborhoods.”  After several years of successful work, SWOP was officially created in 1996.

How is SWOP Revitalizing the Southwest Side?

SWOP is now known for its “fight to end predatory lending” in the region, specifically in relation to local immigrant communities.  The Chicago Tribune emphasized that SWOP has been able to make headway into combatting the effects of foreclosure by gaining trust within the community and working directly with residents in its ground-up efforts.  

Notably, SWOP executive director Jeff Bartow was interviewed for comments early on in the foreclosure legislation process.  In April 2009, just after the signing of foreclosure grace period legislation in Illinois, Bartow emphasized the importance of providing homeowners in foreclosure with additional days to remain in their homes.  SWOP has been working to help neighborhood families since, and it is now focusing on revitalization efforts.

With the $750,000 of funding it has received from the MacArthur Foundation, SWOP is identifying prospective renters and homeowners who may be interested in renting or buying some of the empty properties on the Southwest side.  In addition, SWOP hopes to use the grant to “move into its own offices, improve its technological capacity, and boost employee training.”

Ultimately, SWOP plans to work with local developers, including the successful Brinshore Development, to “acquire and rehab” more than 600 “chronically vacant buildings” on the Southwest side

The grant funding comes just months after SWOP worked together with Illinois Attorney General Lisa Madigan and other community-based organizations to tour neighborhoods impacted by the housing crisis and to hear residents’ concerns about the vacant buildings in their areas.  In addition to the MacArthur funding it has just received, SWOP hopes to add to its revitalization efforts through monies received from the National Foreclosure Settlement Awards.

Do you have questions about foreclosures or community rehabilitation in your area?  Contact a foreclosure attorney today.

See Related Blog Posts:
Illinois Land Bank Aims to Revitalize Communities
More Funds Committed to Illinois Foreclosure Victims

Freddie Mac Says Mortgage Rates Are Easing

Are you hoping to become a homeowner this year?  There’s good news.  According to a recent article in the Chicago Tribune, mortgage rates are easing.  By the end of February, Freddie Mac reported that interest rates had fallen, meaning better rates for borrowers.  This news comes after weeks of rising rates.

Dropping Interests Rates Mean Good News for Potential Borrowers

Which loan terms is Freddie Mac referring to?  In fact, most terms have shown that they’re easing a bit.  For well qualified borrowers, 30-year mortgage rates have dropped from 3.56 down to 3.51 percent (the average this year was 3.7 percent), 15-year fixed loans dropped from 2.77 to 2.76 percent, and even the start rates for “popular types of adjustable mortgages” fell slightly.  Of course, these rates are typically offered for buyers who have “good credit scores, 20 percent down payments or home equity, and the financial wherewithal to afford payments.  But even if you don’t have excellent credit or have dealt with foreclosure issues in the past, you may still be eligible for a home loan, such as a dignity mortgage.

Despite the fact that rates are easing, the Mortgage Banker Association reported that the number of mortgage applications dropped toward the end of February, approximately 3.8 percent.  If you have questions about obtaining a mortgage after a foreclosure, an experienced attorney can answer your questions today.

Do You Know Enough About Home Loans?

But in the meantime, do you know enough about mortgages?  The Los Angeles Times published a mortgage quiz, intended to test its readers’ knowledge.  As you may know, you’re likely going to need a mortgage in order to become a homeowner.  But in the past years, a “multitude of risky home loans, many of them made without documenting borrowers’ incomes.”  These loans prevented millions of Americans from life-long homeownership and led to the bursting of the housing bubble, which has shown itself in the “shock waves of foreclosures” across our country.

What you may not know is that, in reaction to the housing collapse, the Federal Reserve has worked to make interest rates lower than ever to encourage borrowers to buy a house, despite the stringent mortgage standards.  In fact, interest rates for a 30-year fixed home loan averaged nearly 16.6 percent thirty years ago, compared to 3.7 percent in 2012.  According to the Los Angeles Times, there are a few other pieces of information you might like to know about mortgages.  The Federal Housing Administration created the popular 30-year mortgage with a fixed interest rate to allow millions of Americans to become homeowners.  Next to mortgages, nearly all other homeowners—people who don’t need a mortgage loan—are “investors who are flush with cash.”  In other words, if you want to own a home, you’ll likely need a mortgage, and home ownership can seem tricky amidst all the foreclosures in our state.

If you already have a mortgage, lower interest rates mean good news for you, too.  The Mortgage Bankers Association reported that 80 percent of home loan applications in recent months have been for refinances rather than purchases—like large numbers of other Americans, you can save money even if you’re already a borrower.  If you have questions about home loans, foreclosures, or other real estate matters in Illinois, a licensed attorney can provide answers.  Contact us today to learn more.    

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Dignity Mortgages May Offer Help in the Homeownership Crisis   
Reestablish Your Credit and a New Loan May Be Possible Sooner than you Think

Reestablish your Credit and a New Loan May be Possible Sooner than you Think

One of the many fears for homeowners facing foreclosure or having to short sell their home is the fear that they will not be able to qualify for a home loan for many years after either of those processes.  However, Lew Sichelman points out in an article on obtaining a mortgage after bankruptcy or foreclosure writing for the United Feature Syndicate that this might not always be the case.

Seven years is a time period that jumps out in many consumers’ minds.  Even if you have not dealt with foreclosure or bankruptcy, you heard at some point in your life that you have to wait 7 years before getting financing for a house purchase after bankruptcy or foreclosure.  The rules have changed and Sichelman points out that the new wait time may only be three years for some consumers and even less time for others depending on the situation.

Sichelman explains that you can qualify for a mortgage just 24 months after bankruptcy or foreclosure if you can show that your financial woes were due to “extenuating circumstances” that you had no control over.  As Matt Kovach, product development manager at Envoy Mortgage in Houston, points out these must be “life-changing events that made it impossible” to continue making your payments.  Job loss, serious illness and death qualify as “extenuating circumstances” but divorce, business failure or simply taking on too much debt do not qualify.

That is the first part of the test in obtaining new credit after the required waiting period.  You have to then re-establish a clean credit report to obtain new financing.  Part of this process is showing potential lenders that you learned from your mistakes or “life-changing event” and are now capable of making payments and handling the responsibilities associated with new debt.  Kovach says it quite accurately and succinctly, “Poor credit is not a good indication you’ve learned from your mistakes.”

You may think that the best thing to do is go to a strict cash only policy.  Although this might help you reign in spending, it does not help reestablish credit.  Some lenders might take into consideration cash payments such as rent, utility bills and cellphone payments in building a credit report, but it will be more difficult to qualify.

This blog is not meant to give you a green light to go ahead and declare bankruptcy or foreclosure in hopes of speeding up the process of eventually getting a new loan down the road.  These are major financial decisions that must be discussed with experienced bankruptcy or foreclosure attorneys in order to determine the best financial path for your specific situation.  If you cannot point to “extenuating circumstances” then you might be looking at a longer waiting period which might mean you need to reexamine your current situation to determine what to do.

Government backed loans such as VA and FHA loans typically have shorter waiting periods.  The VA’s rules do not address short sales so you could potentially short sell your home and obtain a VA backed loan practically right away.  However as pointed out earlier, you must re-establish favorable credit to qualify.

FHA loans require a three year waiting period for you if you went through a short sale, foreclosure or deed in lieu of foreclosure, but “extenuating circumstances” could help shorten the waiting period.

Various lenders and government backed loan issuers have more detailed guidelines on how to reestablish credit so you can shorten your waiting period.  It is important to keep this in mind and remember that you do not need to give up on the American Dream of owning your own home simply because you experienced a financial hardship that led to a derogatory mark on your credit history.

See Our Related Blog Posts:
What is a Deed in Lieu of Foreclosure?
Underwater Property Owners Step Away from the Cliff

Huge Flaws in Independent Foreclosure Review Process?

Foreclosure defense attorneys are acutely aware of the myriad of problems with the way that many of the nation’s biggest lenders have handled foreclosures over the past decade.  All of that reached culmination in the housing crisis and subsequent “robo signing” scandal where many of those issues made national headlines.  Countless homeowners had their rights violated in one way or another as a result of the sloppy, confusing ,and downright fraudulent practices by some lenders.

In response to the disaster, an enormous “auditing” process was initiated known as the Independent Foreclosure Review.  It involved thousands of contractors combing through millions of pages of documents to get to the bottom of the many problems with the process--things like mixed up loan modifications, overcharges ,and paperwork errors.  However, according to a new story in the Huffington Post, that auditing process was doomed from the start.

Covering Up Foreclosure Mistakes
The story explains that those charged with spotting the errors were given only minimal training and confusing instructions.  Some of those workers even went so far as to say that they were told by one lender, Bank of America, to ignore some instances where there was obviously bank-caused mistakes. The article quotes one of the contract workers who shared information as saying: “We knew what we were looking at.  But we were told under threat of losing our jobs to not report what we saw."

A big concern was apparently the lack of uniformity and independence in the review.  The former chair of the Federal Deposit Insurance Corporation (FDIC) did not mince words when criticizing the auditing process.  She said, "It was doomed from the beginning.  It was designed to generate fees for consultants, not to help homeowners."

These serious problem with this auditing process is what led to its sudden halting last week.  Instead, a new $8.5 billion settlement was reached with ten large mortgage companies. Virtually all of the homeowners who received a foreclosure notice in the peak of the housing crisis--2009-2010--are expected to receive some compensation, though it may be only a small check in many cases.  In addition, some of the funds will be used to negotiate loan modifications to help keep families in their homes.

Help with Foreclosures
Sadly, these reports of cut corners and disregard for consumer rights is not exactly news to those of us who have worked on these legal issues for years.  It is yet another reminder of the need for all residents in Chicago, Oak Park, River Forest, and other nearby communities to seek out professional help when facing foreclosures.  These big lenders should not be able to get away with violating the law and stepping on the rights of homeowners.  You have options to fight back and defend yourself when facing foreclosure.  Please take a moment to contact our legal team today to see how we can help.

Foreclosures in Illinois Near Top of Nation in 2012

Most of us probably made a few resolutions for the start of the new year.  Losing weight, learning to meditate, feeling less stressed, and enjoying the simple things in life are always some of the most popular goals around this time of year.  Hopefully you have not yet given up on those goals and, no matter what the bumps in the road, are still working through this first month of the year with a positive spirit.

Of course, things are always made more difficult if you have financial pressures and are in fear of losing a home.  Facing foreclosure obviously comes with significant stress, anxiety and worry.  It is hard to focus on the “simple things” when your mind is overloaded with fear over how you will be able to fight back against a bank’s effort to take your home.

If you live in Illinois you have a greater chance of dealing with this situation.  New data that was recently released suggests that Illinois is near the top of the list in the country for total foreclosures in the last year.

Much Room for Improvement
As reported in a Chicago Tribune article this week, while 2012 saw a slight decrease in foreclosures nationwide, the news was less rosy in Chicago, Oak Park, River Forest, and the rest of Illinois.   All told, 2012 saw a 3%decrease in foreclosure nationwide when compared to 2011.  But half the states, including ours, saw an uptick--  the uneven pace of the housing recovery is a reminder of the local factors that are heavily involved in balancing out the market.

Realty Trac--the company which publishes the data on this issue--noted that foreclosures in Illinois actually rose 33% in 2012 compared with 2011.  Specifically, Cook County saw 70,233 foreclosure filings last year.  Statewide the total number of homes  in foreclosure was at 135, 858. That is quite a bit of difference from the national trends, and a reminder that many local residents are still battling to protect their home. When the total foreclosure are measured against all homeowners in the state, about 2.58% are in foreclosure.  That is a sizeable percentage, placing Illinois fifth in the nation for the percentage of homeowners facing the prospect of losing their home.

One bit of good news is that the data found that the number of homeowners underwater declined in our state in the last year as compared to 2011.  Right now about 29.6 % of homes in the Chicago area are underwater.  Six months ago, in mid-June, that number was at 30.1%.  While not a huge jump, it is a sign that things may, slowly, be evening out.

Summarizing the situation, one Realty Trac professional explained, “We expect to seek continued increases in judicial foreclosure states near the beginning of the year as lenders finish catching up with the backlogs in those states, and another set of increases in some non-judicial states near the end of the year as lenders adjust to the new laws and process some deferred foreclosures in those states."