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Foreclosure rates spike throughout region

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Ellsworth, 54011
Pierce County Herald
715-273-4335 customer support
Ellsworth Wisconsin 126 S. Chestnut St. 54011

The response to the foreclosure lawsuit was handwritten on sheet of lined paper ripped from a spiral notebook.

"I don't know what I'm suppose to say except I went through a divorce and my ex-wife went off and left me with the house. I could not afford this on my paychecks. She would not help me pay on the house. I do have the house up for sale. I hope it sells this time."

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The man and his wife borrowed $97,642 in December 2003 and presently owe $101,405 on this mortgage. He lives at their house in Glenwood City. She now has an out of state address.

The couple is among hundreds of area residents losing their homes as foreclosure filings make a steady climb to all-time highs.

"It seems like virtually every day I have one or two or three hearings about foreclosures," said Judge Eric Lundell, the senior of St. Croix County's three judges.

In 1995 banks and mortgage companies filed 42 foreclosure cases in St. Croix. Last year the number was 212 -- an increase of over 400% in a decade.

The numbers are even higher this year. During the first three months of 2006, 99 foreclosure cases had been filed in St. Croix County. That compares to 56 in the first three months of 2005 -- an increase of 77%.

Although the numbers of foreclosures filed annually in neighboring Pierce County are less, the figures are climbing there too.

In 1995 19 foreclosure files were opened in Pierce. Last year there were 96 cases -- also an increase of over 400% in a decade.

In the first three months of 2006, 33 foreclosure cases have been filed in Pierce County. That compares to 23 in the first three months of 2005 -- an increase of 43%.

By the time the bank files for foreclosure, most homeowners have given up and don't attend hearings, which often end up being telephone conferences between the judge and the bank's attorney.

Because the judges have little or no contact with the debtors, Lundell can only speculate on what leads to their money problems.

But he thinks he knows: "People are simply way over-extended."

He speculates that homebuyers get a good deal on an adjustable rate mortgage but when the interest rate goes up, they can't make payments and give up.

Nearly all the foreclosures coming through his court are relatively new debts, said Lundell. Also, he said, the amount owed is often more than or equal to the value of the house.

Lundell said he has asked mortgage company lawyers what kind of appraisals are used to let homebuyers borrow up to and beyond the full fair market value of their houses.

The attorneys he has questioned don't have a response, said Lundell. "They don't know. They don't have an answer to that either."

Lundell said he has had one or two cases in which he believes mortgage companies "duped" people into providing erroneous information to qualify for loans when they simply didn't have the ability to make the payments. He sent one of those cases to a U.S. attorney for investigation.

"When times were really good, (some) lenders were getting people into mortgages by hook or by crook," said Lundell.

Foreclosures can be handled in as few as two short hearings -- one to sign the judgment and one to confirm the sale of the property.

An individual case doesn't add much to the judges' workload, said Lundell.

"We're not complaining about the time aspect of it," he said. "But what we're concerned about is the people aspect of it."

Judy Wiff can be contacted at regional@rivertowns.net

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