Ohio foreclosures drop for second year in row: Hamilton’s state rank gets worse

Cincinnati Enquirer - April 9, 2012

Paul E. Kostyu

The number of foreclosure filings decreased in Ohio for the second year in a row, but changes across the state made Hamilton County the sixth worst among the 88 counties, even though the county numbers declined.

New filings in Ohio dropped 16 percent from 2010 to 2011, according to a report released this week by Policy Matters Ohio, a Cleveland-based, left-leaning non-profit research organization. Housing trends, however, show thousands of delinquent properties. Roughly 30 percent of the 500,000 mortages in the state are underwater (worth less than what the homeowners’ initially paid).

“Any reduction in foreclosure filings is a good thing,” said David Rothstein in a statement. Rothstein is project director for asset building at Policy Matters and the report’s author.

Filings declined at less than the statewide rate in Hamilton and Warren counties, but slightly higher than the state rate in Butler and Clermont counties.

New foreclosures nationally declined 1.92 percent from January to February, according to RealtyTrac, a website that tracks foreclosures and real estate. Ohio ranked seventh highest in foreclosure activity nationwide, according to the website. California was first, followed by Florida, Georgia, Illinois, Michigan and Texas.

According to Real Estate Economy Watch, 2011 foreclosure activity and the national foreclosure rate both fell to their lowest levels since 2007. National foreclosure activity in 2011 was 34 percent lower than in 2010. That’s more than two times better than Ohio.

In fact, foreclosure filings dropped in all but two of Ohio’s counties, according to the report, based on Ohio Supreme Court data.

“It’s clear that mediation and foreclosure prevention programs are making a dent in the number of people losing their homes,” Rothstein said. “Ohio policymakers must put more resources into these efforts because we’re still in crisis.”

But Sister Barbara Busch, executive director of Working In Neighborhoods, said she doesn’t believe the numbers are a true indication that the foreclosure picture has gotten better, at least not in Southwest Ohio. Her organization helps people make informed choices about home ownership and personal economics in Hamilton, Butler, Clermont and Warren counties.

Busch said she’s been told foreclosures will increase in 2012 because banks have been holding back on filings in the wake of national investigations into robo-signed mortgages. As those issues get settled, she said foreclosures will climb.

On the other hand, Matt Strauss, director of marketing and neighborhood promotion for Price Hill Will, said he’s seeing evidence of improvement. Price Hill Will is a community development corporation that works in East and West Price Hill and Westwood.

His optimism is tempered, he said, because the three neighborhoods he works in have been the worse for foreclosures in Cincinnati for three years, even though the number of filings is going down for the county.

According to an annual study by Working in Neighborhoods, foreclosures increased from 2009 to 2010 in Westwood, West Price Hill and East Price Hill from 129 to 137, 108 to 118 and 81 to 83, respectively. They were also the top three neighborhoods in 2008. The 2011 survey will be released April 17, but the Enquirer learned the three neighborhoods will remain at the top of the rankings.

“We’ve got a ways to go,” Strauss said.

He said the foreclosure process itself is problematic and needs fixing by state and federal legislators, but he doesn’t expect a lot to happen soon, “especially in an election year.”

“There’s not a lot the city or county can do to stop foreclosures,” he said, “but they can require banks to take better care of the foreclosed properties.”

When properties fall into disrepair, Strauss said, neighboring properties suffer from decreased values making it more difficult for other homeowners to hang on.

The Policy Matters report identified more than 500,000 underwater mortgages, and found that 8 percent of mortgages are seriously delinquent or in foreclosure statewide.

“While we’re cautiously optimistic about this decrease in foreclosures, we remain very concerned with the dismal indicators on home equity and delinquent loans,” Rothstein said. “They show that more than one in three homes is underwater.”

The report calls for increased federal funding for housing modification programs, an extension of the Mortgage Debt Relief Act and the creation of bonds for demolishing vacant and abandoned properties. Policy Matters suggested state legislation that would regulate mortgage servicers, increase tenant protections during foreclosure, coordinate housing counseling and mediation programs, and ban foreclosure rescue scams.

Ohio foreclosures drop for second year in row

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