"Stalling the Foreclosure Process: The Complexity Behind Bank Walkaways"

Repost from Case Western Reserve University:

Stalling the Foreclosure Process: The Complexity Behind Bank Walkaways

A new report from Case Western Reserve’s Center on Urban Poverty and Community Development documents the problem of so-called bank walkaways in Cuyahoga County, Ohio.

The report, titled Stalling the Foreclosure Process: The Complexity Behind Bank Walkaways, takes an in-depth look at stalled foreclosure cases in Cuyahoga County in order to describe the factors involved in delayed foreclosure cases. Foreclosure cases that remain unresolved for long periods of time can result in serious spillover damages, incurring costs like unpaid taxes, unpaid utility bills, nuisance abatement assessments, maintenance, and in the most severe cases, could include fire damage or demolition.

The researchers examined the court records of 999 stalled foreclosure cases (cases where a decree of foreclosure has been granted but the property did not go to sheriff’s sale for over 180 days), finding that 56 percent of these stalled foreclosure cases could possibly be considered bank walkaways. The researchers also found that the possible bank walkaways are more likely to be vacant, tax delinquent, and demolished.

When considering the status of a foreclosure case in court, the researchers determined that cases where a plaintiff (the mortgage lender or subsequent note holder) took no action for 180 days or more after receiving a foreclosure judgment, and cases where a plaintiffdismissed a foreclosure judgment for reasons that did not involve resolving the mortgagelien, among other scenarios, could possibly be considered bank walkaways.

“It’s difficult to pinpoint exactly what’s going on with a foreclosure case,” reports Michael Schramm, co-author and Research Associate at the Center on Urban Poverty. "Paper and electronic court records might be missing details, and plaintiffs often only give boiler-plate reasons for their actions. But defining the problem and outlining how to recognize it is the first step in finding the solution.”

Click here to download the file.

For questions or comments about this report, please contact Michael Schramm at 216-368-0206.

This work has been possible using the Center's freely available, social, economic, neighborhood and property information database, NEO CANDO, can be found on the web here.

Cleveland Study Provides Roadmap for Other Cities Struggling with Foreclosure

New report from the Center on Urban Poverty and Community Development

http://blog.case.edu//msass/center_spotlight/poverty_center/poverty_center_publications_and_research/

Nationally, foreclosures are up 8.3 percent compared to last year, and the country is on a pace to exceed 3 million foreclosed homes by the end of the year.  With unemployment projected to remain high for some time, the foreclosure problem isn’t likely to subside anytime soon, which means cities all across the country must decide what they’re going to do with a glut of vacant homes that often lower neighborhood property values and invite crime.

One city—Cleveland, Ohio—has been dealing with this problem for some time now.  Because the foreclosure crisis struck early and hard in Cleveland, the city already has a track record of dealing with the problem that other cities may find helpful.

Cleveland’s response is detailed in this report conducted by Case Western Reserve University, Cleveland State University, and the Federal Reserve Bank of Cleveland.  What’s working in Cleveland is a combination of local governments, non-profit organizations, and community groups who mobilized to educate prospective home buyers, prevent foreclosures, and rehabilitate vacant properties.

Please share this report with others working to alleviate the effects of the foreclosure crisis. 

More information available at:

http://blog.case.edu//msass/center_spotlight/poverty_center/poverty_center_publications_and_research/