As you may be aware, the foreclosure crisis in the nation has continued to grow to epidemic proportions. The above crisis has and will continue to hinder the State of Ohio and its counties. Ohio has the highest foreclosure rates of all the states in the nation and has the second largest percentage of loans in the serious delinquency category. On a statewide level, the number of foreclosures rose 34 percent in one year, to a high in 2004 of 59,007. The same rates rose another 23% in 2006. Specifically, Lake County foreclosure rates have more than tripled over the last decade. During 2006, Lake County had 1,114 foreclsoure filings, which was an increase of 24% over 2005 rates. According to an article recently published in The News-Herald on November 19, 2007, 835 homes in Lake County have been placed in sheriff sales this year, compared to the 1,534 homes that faced foreclosure proceedings in 2006 alone.
The foreclosure crisis has severely impacted the County in ways similar to other communities throughout the states, which includes housing values being substantially decreased over the last year; the home sales market being slowed to a small crawl specifically for houses over 2,500 square feet; new home construction has substantially slowed, which in turn means loss of employment; bankruptcy filings in Lake County has doubled this year compared to the previous year; the Lake County Treasurer's office has seen more individuals requesting information regarding the County's Escrow Program for property taxes; and the Lake County Sherriff's Office claims crime in the area are increasing and the vacant houses are inviting vandalism and a higher level of homeless squatting.
Due to the above crisis and the impact on our County, FHRC has received an increase in our client intake assessment. Therefore, FHRC has had to change with the times and incorporate programs and initiatives to help prevent and/or mediate foreclosure. FHRC has implemented various programs, which includes the ERMA (Emergency Rental and Mortgage Assistance) program, with a specific focus on foreclosure, our NFMC (National Foreclosure Mitigation Counseling) grant, and the Lake County Foreclosure Task Force. Also, FHRC has increased our Loss Mitigation / Foreclosure Prevention counseling efforts. With increasing our counseling efforts and with the implementation of the above programs, FHRC staff time is being consumed. On average it takes approximately 20 hours of an experienced housing counselor's time to perform loss mitigation. The above time constraint far exceeds FHRC normal counseling time of 2.0 per person. Because of the current crisis, FHRC and Lake County have programs to help combat the effects that the crisis is having on our residents:
The ERMA program was created to assist income eligible households who suffered an inability to pay for housing related costs arising from an unexpected crisis which could cause a potential foreclosure. Through this program, the County provided financial assistance on behalf of the eligible households in the form of a grant over a period of up to two (2) consecutive months to providers of such services as mortgage payments up to a $2,000.00 limit. FHRC has received three rounds of funding to date, two of which had a combined total of $120,000 with a third award of $60,000 for FY 2007. The County has just decided to increase the limit of funding from $2,000 per household to $3,000 per household to assist individuals with higher monthly mortgage payments.If a loan modification is obtained, homeowners could recieved up to $3,500 in downpayment assistance.
The NFMC grant assists FHRC with additional financial resources to help ease the financial costs and allow FHRC to hire additional staff, whose main focus will be on overseeing the ERMA program, providing loss mitigation counseling to area homeowners, providing direct assistance to the Executive Director of FHRC, and the Commissioners in formulating the task force and marketing strategies regarding FHRC foreclosure prevention programs. The NFMC grant has also had a significant impact on the agency's marketing and outreach strategies, allowing FHRC to reach out to individuals encouraging them to utilize our services. FHRC received $36,667 in funds from the NFMC grant and the clients to be served are individuals who own single-family homes that obtained subprime loans, delinquent on their mortgages, and /or are at risk of becoming delinquent. The above grant is set to end in December of 2008, which will force FHRC to seek alternate funding to help ease the financial cost of the impact that the foreclosure crisis has had on our agency.
Through the initiatives discussed above, FHRC has been able to assist delinquent homebuyers in their efforts in pursuing ways to keep their homes.
