The figures were sobering Thursday night: More than 5 percent of Berwyn’s housing stock already has hit foreclosure or gone to court-ordered auction.
That equates to 869 properties in the city, Community Development Director Robert Dwan told residents during a monthly community group meeting at City Hall. What’s more, the rate of properties heading into foreclosure isn’t slowing down.
Dwan said they are projecting that 993 properties — mostly single-family homes, two-, three- and four-flats — will be in foreclosure by the end of December. Those additional properties, combined with foreclosures finalized by the end of 2007, are expected to result in 10 percent of Berwyn’s residential properties in foreclosure.
“We don’t want vacant houses,” Dwan told residents and members of the All Berwyn Committee. “Vacant houses invite crime. I can tell you, it’s daunting.”
In meetings with representatives from other communities, an Oak Park official tried to impress the extent of that village’s foreclosure woes, Dwan said. It was a far cry from Berwyn’s.
“Oak Park says they’ve had 70 foreclosures,” he said. “That’s not a calamity. This is a calamity.”
Members of the All Berwyn Committee hosted the monthly meeting to address why properties wind up in foreclosure, how that can be prevented and what it means for neighbors and a community.
With analysts proclaiming the nation’s economic outlook as grim on some of its best days, residents have been left wondering how to hang on to their homes amid layoffs, soaring prices on consumer products, staggering fuel and upcoming utility bills, and mortgage rates that looked good at first until those adjustable rates readjusted out of homeowners’ price ranges.
Jan Galbraith, who leads the All Berwyn Committee, said many times people blame the homeowners when their properties are sent to foreclosure. But about 30 percent of foreclosures result from unemployment, he said.
“Somebody lost a job,” Galbraith said.
Others can result from costly medical bills, prospective homebuyers falling victim to predatory lending agencies offering subprime loans or adjustable rate mortgages.
Ruben D. Feliciano, housing policy analyst and outreach coordinator for the Latino Policy Forum, said that between 1996 and 2006, the subprime mortgage market grew from $97 billion to $640 billion. Latinos have not been immune to the foreclosure crisis, he explained.
“Latinos were targeted by lenders, receiving high-cost loans at disproportionate rates,” he said. A study in Chicago showed “Latinos were 1.5 times more likely to receive high-cost loans than whites.”
Berwyn Township Trustee Eduardo Rios questioned whether some Latinos were targeted by Hispanic businesses, with shared language and cultural experiences helping these businesses prey on Latinos.
“That was one of the things we found,” Feliciano said.
Hispanics were 2.5 times more likely than non-Hispanics to save money for a house, he said of a recent study they conducted. In the past decade, Latinos have made strides to increase home ownership.
“The foreclosures totally wiped that out,” Feliciano said. “You now have people who are no longer home owners who become renters. You will see more of an issue with overcrowding.”
He said organizations such as the Spanish Coalition for Housing provides foreclosure counseling for families in Cook County and Chicago. Chicago real estate lawyer Jay Reyes said there also is a free legal clinic, The Chancery Division Advice Desk, operated on the 13th floor of the Richard J. Daley Center in Chicago. Staffed by lawyers with the Chicago Legal Clinic, they could help residents facing foreclosure.
But one hurdle is asking for help. He said 80 percent of foreclosure cases go uncontested in court. In most of these, homeowners don’t even appear in court to fight the foreclosure. Many cases take 18 months to resolve, Reyes said.
Sometimes homeowners, working with pro bono lawyers, can work out deals with mortgage lenders, he said, enabling families to remain in their homes, or leave it without losing more money in the process. Asking for help is the first step to climb back out.
“We live in a shame-based society. We don’t like to admit failure,” Dwan said. “I get very passionate about this because I see the suffering that goes on.”
