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Housing Bulletin-Where the Foreclosures ArePosted On: 12-18-07
BY DENNIS RODKIN
Do you know someone who has recently lost or is about to lose his house in a foreclosure? If you don't, you may very soon-and that's true whether you're rich, poor, or somewhere in the middle. The latest and most precise figures show that foreclosures are on the rise everywhere in the Chicago area, including such affluent places as Glencoe, Lake Forest, Hinsdale, and Lincoln Park.
Last week, the National Training and Information Center released figures compiled by Record Information Services (RIS), a data-gathering company based in far western Kane County. The figures compare the number of new foreclosures in the first half of 2006 with the same period in 2007. They are broken out for 77 individual neighborhoods in the city and 254 suburbs and outlying towns in the Chicago area.
Keep in mind that some of these communities are very small. Eight or nine foreclosures may not seem so bad, but scattered among only a few hundred houses, they are significant. High-priced areas with big leaps in their foreclosure rates include:
- Burr Ridge, up 350 percent
- Riverwoods, up 300 percent
- Northfield, up 250 percent
- Kildeer, up 200 percent
- Glencoe, up 150 percent
- Hinsdale, up 136.4 percent
- Wheaton, up 118.5 percent
- Lincoln Park, 105.6 percent
- Lincoln Square, up 100 percent
- Highland Park, up 95.5 percent
- Naperville, up 75.9 percent
In each chart, RIS listed communities in order from the densest concentration of new foreclosures to the least. In the suburbs, Bellwood was the densest, with 43.3 foreclosures per square mile. Ten communities were the least dense, with zero foreclosures per square mile; they include Barrington Hills, Kenilworth, Hodgkins, and several small, far-flung towns. The city neighborhood with the densest concentration of foreclosures was West Englewood, with 111.2; the least dense was the Riverdale, with 1.2. Most analysts are saying that a heavy concentration of foreclosed properties foretells a sharp decline in property values, so these figures may tell a lot about where we might see disinvestment create new ghost towns.
But the more revealing columns in these charts are the ones that show the increase (and in a few cases, the decrease) in a community's number of foreclosures. The raw numbers may not seem so big-in Glencoe, for example, the number of foreclosures went from two in the first half of 2006 to five in the first half of 2007-but the percentage change speaks loudly.
"You always have a certain level of foreclosures because of job loss or divorce or major health catastrophes," says Jeff Metcalf, the CEO of RIS. What we're seeing now, he suggests, is the "result of people wanting to get that house with the pool or the tennis court or the three extra bedrooms. A lot of upscale people took advantage of the low adjustable [mortgage] rates, and now they're feeling squeezed when the rates went up."
Subprime mortgages, those typically extended to lower-income people with poor credit history-and, in many cases, little financial expertise-still account for about four out of five foreclosures, according to figures from Metcalf, but the remainder may be people "who took the risk knowing it was a risk, and they lost the bet," he says.
Having taken up residence far west of the city, where many new subdivisions lie, Metcalf also has a theory on why several outer-ring suburbs have seen big spikes in their numbers of foreclosures: People buy out there for the affordable new homes, and the sellers of these new homes tell them property taxes will be low.
"Then," says Metcalf, "after a few years, when the schools and the police and the fire department and the library have all raised taxes to keep up with the new population, the tax bill hits them hard and a lot of them can't afford to keep the house."
So what about you? Do you know anyone in foreclosure? Are you in foreclosure? Tell me about it. I'd like to know how you got there. Maybe I will put your story here on the blog in a future edition.
Posted On: 12-18-07Poorer neighborhoods hit hardest, but wealthy, middle class also squeezed Posted On: 12-11-07
BY ART GOLAB Staff Reporter/agolab@suntimes.com
December 4, 2007
The home mortgage meltdown isn’t just gutting the poorer parts of town.
It’s beginning to hammer wealthy and middle class Chicago neighborhoods like Lincoln Park, Lincoln Square, Irving Park, Portage Park and Mt. Greenwood — all areas where home mortgage foreclosures have shot up by 100 percent or more from 2006 to 2007.
Data released Monday by the National Training and Information Center shows that in Lincoln Park there were 18 homes in foreclosure during the first six months of 2006 — but that number more than doubled to 37 for the first half of this year.
In terms of sheer numbers, poor neighborhoods still are feeling the worst pain. But percentage increase in mortgage defaults is climbing faster in middle class areas, according to the data.
Poverty stricken West Englewood, for example, had 348 foreclosures, or 111 per square mile — yet that was just a 58 percent increase over the previous year.
But in middle class Portage Park, the heart of the Northwest Side Bungalow Belt, mortgage defaults jumped from 32 homes to 94, a whopping 193.8 percent.
"You had a lot of upper-income people taking advantage of the low rate adjustable rate mortgages, interest only loans and other programs that were available in order to move up, to get an extra two or tree bedrooms," said Jeff Metcalf, president and CEO of Record Information Services, which provided much of the raw data used NTIC analysis.
"And when the job loss, economic slowdown, or declining home values hits, it hits all spectrums rich and poor,” Metcalf said.
A glance at a list of foreclosure sales compiled by Metcalf and posted at www.suntimes.com, shows most of the homes are in poorer neighborhoods in than South and West Sides.
But Monday, a single family home at 2040 N. Sheffield, in the heart of Lincoln Park, was due to be auctioned by a lender to recover $625,000 still owed on the mortgage. Also up for auction was a 36th-floor Gold Coast condo at 111 E. Chestnut to reclaim $542,00 in borrowed money.
Harold Freeman’s home nearly wound up on that list. A truck driver, he had realized his dream of home ownership by buying a three-bedroom brick ranch in the mostly black, middle class neighborhood of Calumet Heights, near 87th and Stony Island.
Then came the one-two punch of a job loss and increases in his adjustable rate mortgage, which soared from 6 to 11 percent while he was out of work. That boosted his monthly mortgage from $1100 to $1900.
"My dream turned into a nightmare. The phone calls didn’t let up, morning noon and night. The pressure and stress brought on migraines. My doctor took my blood pressure and said ‘What’s going wrong in your life?’ ” Freeman said.
Freeman paid "a lot of money” to services to try and renegotiate his loan with no success. Then a month ago he found the non-profit NTIC, which charged him nothing and got his lender to shave off $60,000 in missed payments and knock the interest rate down from 11 to 6 percent.
"Then the calls stopped, the harassment stopped I can breathe,” he said.
Losing a home through can be traumatic for the family that is forced out, but it also can be devastating for those left behind.
In West Englewood, with an average of one foreclosure on every block, the empty homes not only drive down property values for everyone else and become boarded up eyesores, they become targets for vandals, scrap thieves, and drug dealers, said David Rose, director of research and technology at the NTIC.
Federal regulators hope to slow the rate of foreclosures by pushing the banking industry to freeze adjustable rate mortgage "resets,” for those who cannot afford them.
"Freezing the ARMS is a good first step,” said Rose, but he added that lenders should also work with borrowers to permanently change the terms of the loans so they don’t get into trouble again.
Also, government and lenders should to find new, healthier ways to bring mortgage money into poorer neighborhoods rather than just subprime lending.
"And to make sure this doesn’t happen again we’ve got to slap some rules on an industry that has gone virtually unregulated,” said Rose.
Overall in Chicago, the foreclosure rate was 40 percent higher for the first six months of this year compared to a similar period in 2006.
Posted On: 12-11-07Big homes, large loans raise rate of foreclosurePosted On: 07-23-07
By Becky Yerak | Tribune staff reporter
July 22, 2007
Weed complaints are up in Highland Park, and so are foreclosures.
"A good amount" of the gripes, said assistant city manager Patrick Brennan, "is attributable to the increase in the number of foreclosures. Many times, when a property is in foreclosure, it's abandoned."
Lower- and more moderate-income areas continue to be hit by foreclosures, but pricier communities in Cook and Lake Counties are hardly immune, according to an analysis done for the Tribune by Record Information Services Inc.
The Kaneville-based public-records tracker looked at foreclosures involving mortgages of $350,000 and higher and found 584 in those two counties in the first five months of 2007, more than double the 265 recorded in the same period last year and 117 in 2005. For comparison's sake, the median home price in the Chicago area is $252,000.
In many cases, the owners had the mortgage for less than a year, said Patty Maier, Record Information's data management director. "Are these cases of biting off more than they could chew or faced an unexpected personal crisis? Maybe a little of both," she said.
Foreclosure proceedings begin when an owner misses at least three mortgage payments and the lender files for a judgment. It usually takes seven months from that filing for a property to go to auction. During that time period, the owner still has rights. Potential investors, for example, can buy the home and assume the loan. Ultimately, the lender may repossess the property and resell it to recoup the loan.
In the interim, the fallout from foreclosures spills over to the neighborhoods in which they are located: pests living in overgrown yards and unsightly aesthetics, such as toppled planters, soggy phone books in driveways and tacky for-sale signs in windows.
There also are the worries of kids slipping into abandoned houses and the prospect that neglected properties will pull down neighborhood housing values. A foreclosure lowers the price of nearby single-family homes, on average, by 0.9 percent, one recent study showed. Each additional foreclosure on the same block cuts values another 0.9 percent.
Highland Park, where the median family income, according to city estimates, is $117,000, had 15 foreclosures involving mortgages of at least $350,000 in the first five months of this year. That's on track to be triple the number the suburb recorded in all of 2005. In 2006 it posted 26 such foreclosures.
Two of the latest foreclosures, one on Point Lane and another one street over on Museum Drive, are roughly at-the-buzzer basketball throws away from what was the longtime residence of former Chicago Bulls star Michael Jordan.
So far, housing values overall have not been hurt, Mayor Michael Belsky said, noting that property appreciation continues to rise in the heavily residential city of more than 11,000 households.
"Even with 40 homes [in foreclosure], it's not going to have a significant dent in the economy, but it's not surprising given what's going on nationwide," Belsky said.
The mayor said some residents are insulated from economic upheaval. "You do have some wealth, and you also have a lot of professionals that even in bad economic times are going to do OK because they're bankruptcy lawyers or something like that."
There are lots of reasons for foreclosures. Four out of five consumers had no idea what they were getting into with lenders' creative financing, said Tom Koikas of Exit Premier Realty in Park Ridge. Hired to sell a foreclosed property on Cavell Avenue, he believes it's simple: Too many people bought homes they couldn't afford.
Other reasons cited range from family emergencies to divorces to business problems spilling over into real estate holdings.
For example, Estelle Walgreen faces foreclosure on an investment property adjacent to her $3.3 million Lake Forest home, where neighbors tried to banish her pet potbellied pigs.
Divorced from an heir to the Walgreens drugstore chain, Walgreen explained last week that the foreclosure on her Sheridan Road rental property, which has a $1 million mortgage and is currently occupied by tenants, is related to the recent bankruptcy of her Wisconsin business, Converse Industries Inc., which sold parts to Harley-Davidson Inc.
"It has, in great part, to do with the fact that as a business asset, it's tied up with the business, and when the business takes a hit so do the other assets," Walgreen said. "It's now up for sale."
Former Chicago Bears star Dave Duerson has a similar story, facing foreclosure on his 17-room Highland Park home, which he is trying to sell for $1.6 million.
The foreclosure comes nearly 10 months after his Duerson Foods, which processed meats for such chains as Burger King, was forced into receivership. Last month, a Lake County judge ruled against Duerson in a foreclosure proceeding, finding that he owed nearly $550,000 on the Kelly Lane home that he had mortgaged to keep his business running.
In some cases people trade up to bigger houses with the assumption that their earnings will continue to rise, but sometimes paychecks can fall off just as quickly.
"I was starting to pull in $15,000 a month," recalled Libertyville's Peter Phagan, who started his own brokerage in 1992, working at the Chicago Mercantile Exchange.
"From January to June of '04, I had done more business than I had done in any year before. It was 'Let's get a nice house.'"
So Phagan sold his $230,000 Libertyville home for $400,000 and bought an even bigger one, taking out a mortgage for $513,000. But by May 2005, his earnings fell to 10 percent of their peak, hurt by the shift to computerized trading, he said. And about that same time he decided to invest $300,000 into opening a smoothie business in Libertyville, making his financial situation more difficult.
"One problem is the rent is $25 a square foot -- you spend $4,000 a month to run a store. It's 1,000 smoothies a month just to take care of that. Since May '05 I haven't brought any new money home because I'm trying to get this business up and running."
Now he's looking for a business partner, and his Libertyville home, which National City Bank initiated foreclosure proceedings against, is for sale at $725,000, down from an initial asking price of $750,000. It gets about a look a week, he said.
"I wish I hadn't moved," Phagan said, especially not at the same time as starting a business.
At 1550 Museum Drive in Highland Park, neighbors lament the day work began on what was supposed to be a luxury home that included a 2-acre parcel, an indoor and outdoor pool, elevator and roof deck.
But there's little more to show than a foundation and the beginnings of a superstructure, cloaked in sheeting and surrounded by a chain-link fence. The site is overrun with nearly waist-high weeds.
"It's horrible," declared neighbor Michael Friduss.
The city "said they'll have to tear it down anyway because they won't allow any further building on it because what is there is rotted by now," he said. "You worry about property values, the looks of it, the safety of it for kids, the weeds blowing on your property."
The original mortgage in September 2004 was for $1.7 million and increased to $2.3 million in May 2005. The lender's complaint in Lake County Circuit Court claims it is owed $1.1 million.
The project's architect and construction manager, Hernando Moreno, of Chicago Workshop Architects, said he planned a 13,000-square-foot custom-built home. "It's deteriorating," Moreno said. "If we could find someone to finish it, I'd be happy to help clean it up and build it."
In a response to the foreclosure complaint, Joyce and Felipe Calubaquib said they met their financial obligations but that the bank refused to make advances to complete the home's construction. The couple's lawyer didn't return phone calls. Messages left at a business address and the home address where a notice was served were not returned.
Through its lawyer, the bank, First Bank of Highland Park, declined to comment.
Some homes wind up in foreclosure after contractors are unable to resell them.
Consider 860 Pleasant Ave. in Highland Park, otherwise known as the "orange house" by neighbors like Holly Moore. "No one ever lived there," she said, after the 11/2-story bungalow was renovated and then unsuccessfully listed for about $600,000. "It has been a nightmare," added Jim Graue, whose wife regularly calls Highland Park officials about the tall grass and weeds; yards are in violation when weeds or grass exceed 8 inches in height. At one point the couple complained about raccoons foraging in a pile of trash.
Graue wonders whether the house will be sold. In another part of Highland Park, neighbors even worry about contaminants from a foreclosed and abandoned house.
It's in a development called the Town of Fort Sheridan where many houses were built in the late 1800s. "It takes $100,000 just to make them safe and habitable," said Caryn Tatelli, who speaks from experience and worries about lead exposure from the abandoned property next door.
The owner, she recounted, knocked down part of the house during its planned renovation. But then the lender won a $740,000 foreclosure judgment, and work stopped.
"Until they tore the back off, this was all enclosed so it didn't matter as much," Tatelli said, pointing out peeling paint on what's now the back of the house.
"All of that is lead paint. The board of health can't do anything until we prove that one of our children has exposure," she said. "I think about the hundreds of thousands of dollars we have spent abating lead from our home, and I'm sickened by the fact we live by this giant contaminant."
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byerak@tribune.com
Posted On: 07-23-07ONLINE GUMSHOEPosted On: 05-13-07
Chicago Tribune
Becky Yerak
ONLINE GUMSHOE: Interested in sleuthing on your new neighbor, co-worker or friend, such as finding out whether they've ever filed for bankruptcy? Want to check on a real estate deal?
A new Web site called CheckIllinois at http://consumer.public-record.com gives private individuals the chance to check public data.
CheckIllinois was started by Record Information Services Inc., a Kaneville Township-based company that offers public data to professionals and businesses.
Individual searches also can be conducted on foreclosures, state and federal tax liens, divorces, DUIs, suspended and revoked licenses, and probate proceedings.
The number of Illinois counties covered varies depending on the information. It tracks real estate deals in 15 counties, for example, going back as far as 1998 in Kane, Kendall, Lake, McHenry and Will Counties, and for Cook County since 1999.
Searching is free. When a list of possible records is found, they can be bought for $4.95 each.
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byerak@tribune.com
Posted On: 05-13-07Local Public Records Company Launches Website for PeoplePosted On: 03-18-07
One of Chicagoland’s premiere data gathering firms is finally making its vast Illinois public record databases available to the public. Check Illinois (http://consumer.public-record.com), a subsidiary of Record Information Services, Inc., will allow private individuals to search for public records on their coworkers, friends, neighbors, or anyone else that you would want to background check.
While background checks are a staple in applicant screening processes at businesses, they can also provide private individuals with powerful insight into the activities of others. For example, families who need a hire a nanny, men and women who are on the dating scene, or somebody with an odd neighbor may all consider doing background checks for their own personal safety.
Record Information Services has been providing public record information to businesses for over 16 years through their high-tech searchable website, http://www.public-record.com. Their decision to design a website specifically for consumers is due to the numerous requests they receive from private parties who want to do single searches on people. CEO and founder Jeff Metcalf explains, "We get daily requests from individuals who just want to look up a single name to see their public record. A mother might call who wants to track down a father for child support, people would call to find relatives, or a parent might call to see if their son got a DUI. We knew there was a huge demand from consumers and we planned on creating a program for them, we just wanted to do it the right way."
The consumer website, http://consumer.public-record.com, is set up in a simple, easy-to-use fashion so people can quickly get online, perform a free initial search, and purchase their desired records quickly and affordably. The only information visitors need is the last name of the person they are seeking records on, which you can then sort by city if needed due to the vast number of duplicate last names. Public records databases such as DUIs, Misdemeanors, Felonies, Bankruptcies, Foreclosures, Mortgages, and more can be viewed through the site. Record Information Services obtains this data from eight Chicagoland government sources, and the date history of each database is listed on the site.
"It is important to remember that public records only constitute a file or arrest, and DO NOT constitute an actual conviction" says Tiffany Binaté, marketing director for Record Information Services. "People who search the site would need to look into further court documentation to see the outcome of any criminal arrests, as this site is designed for informational purposes only."
To check out the site and do a free initial search on anyone with Chicagoland public records, visit http://consumer.public-record.com. Record Information Services is located in Kaneville, IL. More information can be obtained by e-mailing info@public-record.com. There are additional plans in the works to expand search capability to Business as well as additional consumer options.
Posted On: 03-18-07Elburn board member won’t run for re-electionPosted On: 01-02-07
Elburn’s village board will change at least one of its members this year.
Village Trustee Jeff Metcalf, who has served on the board for the last eight years, has decided not to seek another term in the coming April election.
“I want to leave on a high note,” Metcalf said. “It’s time for new directions.”
Metcalf, who started Kaneville-based Record Information Services 15 years ago, has decided to devote his full attention to the growing company.
“I think the current board has a lot to be proud of. We’ve gotten a lot accomplished,” he said.
Elburn Village President James Willey said Metcalf will be missed.
“He was very passionate about what we were trying to do here,” Willey said.
Metcalf’s open seat leaves a window of opportunity for residents of the growing village.
One of those residents is Mark Wilson, who plans to run for a seat on the board.
Wilson, who lives in the Blackberry Creek subdivision, would like to be a voice for his neighborhood, which currently does not have a trustee on the board.
“The community isn’t just growing in Blackberry Creek, but in all of Elburn,” he said.
“I think it would be great to have someone from Blackberry Creek on the board,” said Willey. “They absolutely deserve a representative on the board.”
Trustee William Grabarek whose term is also up this spring, will seek re-election for another four years.
“I very much enjoy the work and hopefully the public will deem it appropriate to re-elect me,” he said.
A semi-retired attorney, Grabarek would like to continue with the board to see many of its ongoing projects come to fruition, including the expansion of the village’s waste water treatment plant, the completion of the Jewel-Osco, and the proposed Kirk Homes development on Routes 38 just west of Route 47.
Trustee Gordon Dierschow says that although he has not completely made up his mind, he will likely seek another term.
“I think I’m going to go again,” he said.
As for Metcalf, although he will no longer serve Elburn as a village trustee, he will remain active with the Republican party on a state and national level, and has not ruled out the possibility of running for public office in the future.
“Never say never,” he said. “I think everybody should have the opportunity to serve.”
Those who are interested in pursuing a seat on Elburn’s village board may get information at www.kanecountyelections.org.
By Charlotte Norgaard
Daily Herald Correspondent
Posted On: 01-02-07Foreclosures on the rise in ChicagoPosted On: 07-04-06
Rising mortgage interest rates and high consumer debt loads are sparking a rise in Chicago-area home foreclosures, a marketing data collection firm said Thursday.
The increase in foreclosures is most notable in the fast-growing collar counties, said Jeff Metcalf, chief executive of Record Information Services Inc.
His company is forecasting foreclosures in Will County to jump 51 percent this year, more than any other county in the Chicago area.
Higher mortgage rates are squeezing buyers who opted for adjustable-rate mortgages, Metcalf said.
"Any movement up in mortgage rates, particularly for those who used adjustable-rate mortgages, is going to affect a lot of people," he said.
Also, double-digit increases in home values prompted homeowners to dip into their equity.
"Many homeowners took advantage of the roaring real estate market to take out home equity loans with adjustable rates," Metcalf said.
Those loans are also becoming more expensive and putting additional pressure on consumers already burdened with high debt levels, he said.
"So, many people are maxed out," Metcalf said.
In Will County, for instance, RIS is forecasting a 51 percent increase in foreclosures this year based on the pace of foreclosures during the first quarter.
For all of 2005, 1,900 homes in that county were lost to foreclosure, RIS said. For the first three months of this year, lenders foreclosed on 957 homes in Will, the company said.
Most foreclosure proceedings start after a homeowner has missed at least three payments.
Based in Kaneville, RIS tracks data on home sales, new business openings, bankruptcy filings and civil court proceedings, selling the information to customers that include retailers, banks and mortgage companies.
RIS supplies information on housing trends to Chicago-area newspapers, and the company compiles home sales data that are published in the Daily Southtown.
By Mike Nolan Staff writer
Posted On: 07-04-06
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