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It’s hard to sell your home when it is surrounded by foreclosures.
That’s the trouble Middletown resident Calvin Harpe is facing after he put his home on the market this year. The value has dropped below what he owes because of the number of foreclosures on his street and neighborhood. Even using President Obama’s program to help homeowners refinance has not helped, he said, since it requires he pay down his mortgage to within 105 percent of the appraisal price.
“(Obama’s) plan makes no sense to me because of that. The plan says that people that owe more than what their house is worth may refinance. But they can’t because it will not appraise,” he said.
So while Harpe said he’s not in a financial crisis like many homeowners, “we’re still stuck here.”
Foreclosures stabilizing?
Foreclosures across Butler County seem to be stabilizing, but that could have more to do with the various banks participating in the federal foreclosure moratorium program initiated by President Obama, said Jim Allen, Butler County Sheriff’s Office civil administrative specialist and foreclosure auctioneer.
“The moratorium appears to be having some affect,” he said. “More are getting pulled before the auction.”
For the month of May, 91 properties were foreclosed and sent to sheriff’s auction, and 72 were sold in June. That’s compared to 165 foreclosed properties in May and 106 properties in June 2008, according to the sheriff’s office.
As of the end of June, a total of 517 properties have been foreclosed in the county this year compared to 781 the year before, according to the sheriff’s office.
Hitting homes in a small community
One of the hardest hit has been Lemon Twp., a small community sprinkled in 1,000-plus home sections around the borders of Middletown and Monroe. Only a few years ago, the township would have maybe only a handful of homes lost to foreclosure. Last year, that number skyrocketed to 67, according to the sheriff’s office, and already this year it’s up to 22 foreclosures.
“It’s gotten a lot worse, just like everybody else,” said Robert Snook, trustee for Lemon Twp. for the past eight years. “It’s about five percent of the homes, and at our size, that’s big. You want to see one percent.”
Snook said he believes the high amount of foreclosures is attributable to the economy but also to the high amount of rental properties. When he last surveyed Lemon Twp., he found about 54 percent of the homes were rental.
“It’s typical that in a rental property, the people who occupy it are not reinvesting in the property, and the owner is living somewhere else and not reinvesting, and when the economy collapses like it does, the people renting might lose their job and walk away,” he said. “Then now the value of the house is down, and the owner maybe can’t afford to fix it, so he just lets it go back to the bank.”
And foreclosures are just half the story. Snook said Lemon Twp. is peppered with rundown, abandoned homes mixed in with the foreclosures, making for a dire real-estate situation.
“The foreclosures don’t tell the whole story,” he said. “I think we are in for a long recession.”
Watch out for scams
More people may be seeking assistance today than last year in an effort to keep their homes, said Steven Sharpe, an attorney with the Legal Aid Society of Southwest Ohio, but “we’re still seeing a lot of people,” he said.
Another problem that coincides with the influx of foreclosures is the number of scam organizations taking advantage of the situation — and people’s hard-earned money — as residents desperately seek help, Sharpe said.
Legal Aid, on behalf of a Middletown woman, just filed a lawsuit Thursday, July 9, in the Butler County Common Pleas Court against two Cincinnati-based companies and a Kentucky attorney alleging a foreclosure rescue scam.
The suit alleges the companies, American Foreclosure Professionals Inc. and Foreclosure Assistance USA, provided only the false promise of a foreclosure defense to resident Marsha Fuller in exchange for the up-front fee of $1,200.
“Our main concern is this is a big scam and part of a large issue nationally,” Sharpe said. “Borrowers need to be really careful when they see guaranteed success for an up-front fee. There are free resources available — see those first.”
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