Cleveland has officially joined the growing list of Midwestern cities that have seen a severe increase in foreclosure filings over the last year, and there’s no sign of this dubious trend stopping anytime soon. While subprime mortgage defaults have recently rocked Wall Street and damaged our national economy, the effects of these shady lending practices are being felt by families nationwide, especially so in the Midwest. Michigan and Ohio alone accounted for a combined 15% of the nation’s foreclosures in January, 2007.
Cleveland is in a similar situation to Detroit and other blue-collar working towns in the Midwest experiencing this unfortunate foreclosures spike. Many factors are deemed responsible for the problem – a poor economy, predatory lending tactics, weak consumer protection laws, shady lenders trying to exploit the loosely regulated subprime market for their personal gain, and financially unqualified people obtaining home loans.
The problem however isn’t confined to just the metropolitan areas either, it’s a true statewide problem for Ohio, Michigan and other Midwestern states.
While the SEC (Securities and Exchange Commission) has recently publicly announced that it is investigating a number of companies that operate in the troubled market for subprime mortgage loans, this won’t unfortunately assist or help the families who have fallen or hard times are facing losing their homes in the near future.
Based on household income and an ability to repay, Chapter 13 Bankruptcy is the most effective way to stop foreclosure proceedings. Chapter 13 forces your mortgage company to accept repayment of mortgage arrears over a three to five year period and allows people to stay in their homes. If you or someone you know is involved or will soon be involved in a foreclosure lawsuit, an experienced bankruptcy attorney may be able to help.