Illinois Foreclosure Homes for Sale Rising in Suburban Areas

Illinois foreclosure homes for sale have been rising faster in number in suburban counties than in metro areas, based on an analysis of foreclosure data in September and in the whole third quarter of this year.

While foreclosure postings increased in Cook County in the July to September quarter by only 6 percent over last year, the year-over-year rates of increases in Kendall County, Kane County and in DeKalb County were 693 percent, 103 percent and 169 percent, respectively.

Bob Palmer, executive director of Housing Action Illinois, said many residents in the suburban counties took out subprime loans and other types of risky mortgages that they can no longer pay during the downturn.

In September, more than 7,100 homeowners in Illinois received notices of delinquencies, an increase from 6,892 households in the previous month and 6,770 homeowners in June.

A total of 12,771 homeowners statewide received foreclosure postings, including initial default notices, notices that the properties are going to be sold by the sheriff’s office and notices that the properties have been repossessed by lenders.

Although the number of Illinois foreclosure homes for sale dropped in September compared to August, the number is still much higher than the number posted in September 2008. Total foreclosure postings in Illinois fell by 2.35 percent from the previous month, but remained higher by 25 percent over postings in September last year.

Suburban residents have been trying to obtain help from the Obama administration program, and although some have had their mortgages modified, it is not yet known if these homeowners are able to sustain the modified payments.

Last week, the administration announced that it had achieved its goal of modifying 500,000 mortgage loans and had put them into three-month trials. Many analysts however expect a big portion of these homeowners with modified loans to redefault because of job loss or reduced income.

Based on a report from the Illinois Department of Employment Security, the unemployment rate throughout Illinois has jumped up to the 10.5 percent level in September, a sharp increase from the 6.7 percent level in September last year.

According to Jay Brinkmann, head economist at the Mortgage Bankers Association, foreclosures will still increase and will peak in the last months of 2010 because of the continued rise in job losses and other economic difficulties.