Trumbull foreclosures up 26% despite sales boom

By Ed Runyan

runyan@vindy.com

WARREN

Though real-estate agents posted some of their best sales numbers in recent years in 2012, causing optimism for a housing recovery nationally and locally, Trumbull County foreclosures still are on the rise.

Trumbull County Common Pleas Court reported 1,460 foreclosures were filed in 2012, a 26 percent increase over the 1,162 filed in 2011.

Two Trumbull County officials who deal directly with foreclosures say the increase is related to the $25 billion, February 2012 settlement that five of the nation’s largest mortgage companies reached with most of the 50 states over foreclosure abuse, fraud and improper practices.

Trumbull and Mahoning counties are using most of the money from Ohio’s allotment for housing demolitions.

Michael Robinson, delinquent-tax investigator for Trumbull County Treasurer Sam Lamancusa, and Lynn Griffith III, an assistant Trumbull County prosecutor, say the banks held off on foreclosing on properties in 2011 because the settlement was pending but ramped up foreclosures in 2012 after the settlement was reached.

The settlement stemmed from revelations that banks were using forged and shoddy paperwork to foreclose rapidly on struggling homeowners, a practice known as “robo- signing,” according to The Washington Post.

Statistics from the sheriff’s sales conducted by the Trumbull County Sheriff’s Office showed a similar pattern, indicating that the number of foreclosed homes that went to sheriff sale and ultimately were sold in that process increased in 2012 by 13 percent with the number likely to move higher in 2013.

The pending settlement “slowed the process for a while,” Robinson said of foreclosures. Banks “wanted to back off for a while.”

Several trends have been identified in the Mahoning Valley over the past 10 years, with predatory lending practices identified as one of the leading causes of increasing foreclosures.

Foreclosures peaked in about 2006 and were thought to be abating over the next few years until the economic recession hit, causing the numbers to rise again in 2009.

Despite an improving economy nationally and locally in the past three years, Trumbull County foreclosure numbers are not much better. There were 1,088 foreclosures in Trumbull County in 2003; 1,536 in 2006; 1,602 in 2009; and 1,460 in 2012.

Marlin Palich, president of the Warren Area Board of Realtors, says Trumbull County real-estate sales rose nicely in 2012 over 2011 with total number of units sold rising 6.9 percent and average sale price rising 12.1 percent — from $76,933 to $86,253.

Those trends differ somewhat from the state average, with the number of units sold rising 12.7 percent and the average sale price statewide rising 6.5 percent — from $127,463 to $134,951.

Thomas J. Williams, president of the Ohio Association of Realtors, said last month that the 2012 housing sales were strong in nearly every part of Ohio, including Northeast Ohio.

“Our year-end 2012 results are reflective of a marketplace that appears to have regained its footing and returned to traditionally stable levels,” Williams said.

Palich said he thinks the low interest rates have had a lot to do with improving real-estate sales, with 30-year fixed rates having an interest rate of about 3.625 percent and a 15-year fixed rate below 3 percent. Those are the lowest rates Palich has seen in 35 years in the business, he said.

“There was a pent-up demand,” he said.

Though it isn’t having a significant impact on the number of foreclosures filed in Trumbull County, there has been a significant change in what happens to some foreclosed properties.

Starting in 2012, because of the establishment of the Trumbull County Land Bank, 214 tax foreclosures — most involving a property with no building on it and most of them in Warren — are being handled by the Trumbull County Board of Revision.

Normally a common pleas judge handles foreclosure filings. In the board of revision process, the case is filed with the court, but the board of revision — consisting of representatives of the county auditor’s office, treasurer’s office and county commissioners — adjudicates the foreclosure.

One of Griffith’s tasks as assistant prosecutor is to file cases with the Board of Revision. At the end of the process, the property can be turned over to the land bank and then sold at a low price to people living nearby the vacant land.

Through the board of revision, the banks and other property owners are notified of the county’s intention to foreclose on the property and given a chance to pay off delinquent taxes and retain the property. In many cases, the taxes exceed the value. In nearly every case, the bank or property owner doesn’t respond to the filing, and the land goes to the Land Bank.

In all cases, the property is considered abandoned, Griffith said. When a neighbor buys the lot to expand his property, the new owner generally takes care of it, preventing the city or township from having to maintain it, and it becomes a more productive piece of property, county officials have explained.