Thursday, January 13, 2011

Banks Walking Away from Houses in Chicago

by Bill McBride on 1/13/2011 05:32:00 PM

From Mary Ellen Podmolik at the Chicago Tribune: More banks walking away from homes, adding to housing crisis (ht, Mark, Walt, Bob)

Abandoned foreclosures are increasing as mortgage investors determine that, at sale, they can't recoup the costs of foreclosing, securing, maintaining and marketing a home, and they sometimes aren't completing foreclosure actions. The property, by then usually vacant, becomes another eyesore ...

Research ... identifies 1,896 "red flag" homes in Chicago ... that appear to have been abandoned by mortgage servicers during the foreclosure process, the Woodstock Institute found.
We've seen this before in areas with declining populations like Detroit. These are always low end homes that are worth less than the cost of foreclosing - and it leaves behind a mess for the community and the city.