Vince Alexander

Foreclosure numbers have continued to increase in Butler County over the past few years, according to Lt. Mike Smith of the Butler County Sheriff’s Office.

In 2008, 2,641 homes in Butler County were foreclosed and 1,390 were sold at auction. This is compared to the 2,455 foreclosed homes in 2007, 1,572 of those which were sold at auction.

According to Alan Kyger, Oxford economic development director, foreclosure rates in Oxford are much lower than the county as a whole.

“Miami University, Talawanda School District and McCullough-Hyde Hospital are the largest employers in the area and all contribute to the stable workforce in Oxford,” Kyger said.

Kyger said the stable economy in Oxford contributes to the lower foreclosure levels in the area.

According to a study done by the Center for Statistical Research on recent residential foreclosure experience in, foreclosure levels are cyclical.

“Foreclosure rates are cyclical due to cycles in the economy,” said Miami economics professor James Brock, via e-mail. “When times are good, there are a lot of jobs and income, people have fewer problems paying their mortgages because they have cash flow to draw on.”

Brock said that when the economy is in a recession, the reverse happens-fewer jobs, less work, higher rates of unemployment-and there’s less cash and income flow for people to draw on in paying their monthly home mortgage. Therefore, the rate of default tends to rise.

According to Brock, the current situation is far worse than the usual recession, because so many people were enticed into entering mortgages that they can’t afford.  This results in mortgages that were affordable in good times becoming unaffordable when the economy turns down.

The study also found that whatever is causing the increases in foreclosures in Ohio, it is not concentrated in any one type of lending-whether it is sub-prime loans, government programs or loans through private lenders.

Hollingsworth said for years the housing market has been growing, but due to irresponsible bank loans, the market has declined.

“I tend to blame the lenders for giving out loans without adequate knowledge,” Hollingsworth said.

Smith said the decrease in the number of homes sold at auction could be a good sign.

“We sold 182 less foreclosed homes in 2008 than in 2007,” Smith said. “This could be because of the inner workings of the banks.”

Smith said roughly 55 percent of foreclosed homes are selling inButler County.

According to Smith foreclosed homes that do not sell (no-bid homes) at auction go back to the mortgage holder.

“Homes that do not sell the first time at auction are typically sent back to the banks and auctioned again at a later date,” Smith said.

Smith said that foreclosed homes first become filed with the clerk of courts, and then an attorney will file the necessary paperwork in order to auction the home.

“Foreclosed homes must be appraised prior to auction, and the appraiser must live in the county of the foreclosed home,” Smith said. “Typically 40 to 60 appraisals go out each week.”

Smith said that the attorney’s handle the sales and publications of foreclosure auctions.

2001 saw 940 homes foreclosed in Butler County, with that number jumping to 1,163 in 2002. In 2003, 1,344 home were foreclosed, followed by 1,682 in 2004 and 1,771 homes in 2005.

“Foreclosed homes must be publicized for at least three weeks prior to auction,” Smith said.

According to Smith a rise in the number of foreclosed homes has been a steady trend throughout the decade.

“If anything this trend shows disimprovements in the economy,” Smith said.