• Chicago foreclosures drop in March compared to last year but dramatically rise from February

    Chicago has recently received a bit of good news concerning its ultra-volatile real estate market.  In March, the city’s foreclosure filings fell 15.7 percent from last year.  However, the drop was not quite as positive as one might expect because filings still jumped 23.1 percent from February of this year. Given the large jump from February, many Chicago attorneys specializing in bankruptcies and foreclosures , warn that news, though positive, should be read with a bit of caution.

    RealtyTrac, a nationwide market watch company issued the findings.  The report also shows foreclosure filings at a three-year low across the country.  The news is good but RealtyTrac also warns that the real estate market still faces huge problems and concerns.

    According to the report, Chicago area bankruptcy filings fell 28.2 percent in the year’s first quarter compared to last year.  This year’s quarter also dropped 22.5 percent from last year’s fourth quarter.

    In March, 10,821 homes declared bankruptcy in the Chicago area, falling from 12,830 in March 2010. Approximately one in ever 350 homes file. The state ranks as the eighth worse in the country with one in every 439 homes filing in March; the total was 12,053 in March.

    Nationally, the number of homes receiving filings during the quarter dropped 26.9 percent to 681,153 from a year earlier and fell 14.8 percent from the fourth quarter of 2010.

    Given that bankruptcies are still a pervasive problem in Illinois, bankruptcy lawyers and government officials still warn of possible declines in the real estate market, especially in Chicago.

  • Credit reporting mishaps cause unwarranted foreclosures

    There are a variety of reasons why an individual files for bankruptcy .  Usually the main cause is the person’s inability to handle debt. Other times the main cause is unemployment.  But there are occasions when no person is to blame.  Sometimes it is the banks that are solely to blame.

    A large majority of people in Chicago, the state of Illinois, and nationwide, are at the mercy of banks and their credit reporting practices.  Take for example the tale of a Chicago business owner who recently filed for bankruptcy.  She was in the business buying and flipping houses, when her bank began double- reporting her loans to credit bureaus.  The action made it appear she was overextended and seriously in debt. With a plummeting credit score, she was unable to refinance her homes. With her savings completely depleted, she could not make any of her credit payments.  She was forced to file for bankruptcy.

    What was the cause of the doubling dipping on her credit report? “Bank A acquires Bank B, and during the absorbing of Bank A something goes awry and accounts get misreported to the credit bureaus,” said one credit reporting expert.  That is exactly what happened to this unfortunate Chicago resident.

    The result has led many Chicago bankruptcy and credit report audit attorneys to start investigating further the exact cause of their client’s financial woes.  What the attorneys are beginning to notice is that their client’s problems may have been caused by forces outside their control, such as the double reporting of debts to the credit agencies.