Bank Owned Property Listing Pace Stepped Up in Wisconsin

by on States

The pace of bank owned property listing in Wisconsin in 2009 marked another record for the state as job losses continued to clobber homeowners.

In 2009, nearly 31,000 foreclosures were filed, an increase of nearly 20 percent from the record 25,541 foreclosure filings in 2008, according to a foreclosure research firm that monitors court data on foreclosures. Both foreclosure filings for the two years were record levels for the state of Wisconsin.

According to Russell Kashian, professor of economics at the Whitewater campus of the University of Wisconsin, there is hope that the foreclosure picture in the state will improve this year. But he added that the high levels of underemployment and unemployment will continue to clobber the housing sector. Kashian and other economists reiterate that the unemployment rate of Wisconsin – currently at 8.2 percent – needs to be reduced before foreclosure figures improve.

Bankruptcy lawyer and foreclosure defense attorney David Leibowitz affirmed Kashian’s contention by saying that if job creation is improved by even just two or three percent, the rate of foreclosure will slow down.

Leibowitz also said that the federal government’s bank owned property listing prevention program is not effective despite the reduction of monthly payments because of two reasons: joblessness and the temporary status of the modified repayment schemes. He stated that not many modified loans are being turned into permanent loan modifications. He even said that the loan modification scheme is a great deception because it is only temporary for the vast majority of borrowers getting mortgage modifications.

Philip Crawford, head of a firm tracking foreclosures, said that foreclosure filings will continue to rise in the first six months of 2010 because of the record number of borrowers in negative equity. He said that many underwater borrowers would realize the futility of their situation and would give up saving their homes because of their extreme financial difficulties.

In Southeastern Wisconsin, record foreclosures were also posted last year, reaching a total of 12,745 filings and surpassing the record 10,884 filings set in the prior year of 2008 by 17 percent.

In each of the southeastern counties – Racine, Kenosha, Milwaukee, Washington, Ozaukee, Waukesha and Walworth – foreclosure filings increased, with Kenosha posting the biggest rate increase.

In addition, Milwaukee comprised over 50 percent of total residential units at risk of bank owned property listing actions in 2009, with more than 7,000 units receiving foreclosure notices last year.