6.2 million Underwater Homeowners in Crisis

The housing crash might seem like old news, but for families left behind by the recovery it remains a defining economic reality, with negative equity preventing moves and limiting choices in life.

 Seven years after the Great Recession, some Chicago suburbs may never recover

Chicago Tribune   By Kim Janssen    March 26, 2016

Highlights below:

Cook County’s top 10 towns for foreclosures are all in the south suburbs, according to data compiled by the Institute for Housing Studies at DePaul University. Residents on a typical block in middle-class towns like Matteson, Country Club Hills and Richton Park can expect one of their neighbors to be in foreclosure, because about one in 30 homes was in foreclosure as recently as 2014.

In a handful of the poorest towns — Harvey, Ford Heights, Phoenix, Riverdale, Robbins and Sauk Village — more homeowners are foreclosed upon than obtain new mortgages, a surefire recipe for vacant homes, declining tax bases and blight.

“Everybody seems to think we’ve recovered from the housing crisis, but for many communities of color that’s not the case,” Petruszak said.

The number of lender-mediated sales in the Chicago area — short sales and foreclosures — accounted for 26 percent of existing home sales in February, compared with more than 50 percent just two years ago, according to Midwest Real Estate Data, the local multiple listing provider. But the long-term snowball effect of so many vacant, foreclosed properties in mainly black neighborhoods was exacerbated because banks took less care of the properties they owned there than they did in largely white communities, said Petruszak, who has helped bring national discrimination cases against six lenders.

The couple have friends who walked away from mortgages that no longer made sense, but Mitchell Versher said that wasn’t his style, and that if his wife hadn’t suffered a couple of layoffs, or if they were able to renegotiate their debt again, he’d have liked to stay put.

“I come from the old school,” he said. “My grandchildren visited me in this house. It was supposed to be our home for the rest of our lives.”

Still, he and his wife expect ultimately to be forced from their home. And any hope Mitchell Versher had of retiring is gone.

“I’m gonna have to work till I die,” he said. “Don’t get me wrong, Vietnam taught me that I’m blessed for every moment that I have. But the majority of us who are living paycheck to paycheck are being held hostage by an indifferent political class.”

He’s looking online, for a rental, he said.


Twitter @kimjnews

Copyright © 2016, Chicago Tribune

 It is time to get changes made for underwater homeowners; Still 6.4 million underwater nationally, and most are desperately trying to stay put!

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