Although foreclosure rates are significantly down from their historic numbers at the height of the housing market crash, experts have found that many foreclosure cases are still in limbo. According to a Planet Money story published by NPR, it’s also a lot of work to tie up loose ends for people who are still dealing with foreclosure proceedings initiated during the financial crisis.
At the peak of the housing market collapse, banks across the country became inundated with homeowners who fell behind on their mortgages. With limited resources to keep up with the high default rates, banks and other lenders with large caseloads resorted to filing the paperwork needed to start a foreclosure before hitting deadlines that terminated their right to foreclose. The problem is that they never filed anything else, and instead relegated these cases to what’s been called a zombie docket.
For many homeowners who received a foreclosure notice for filings on this zombie docket, cases never proceeded to the next phase. In effect, their foreclosures were left in a zombie state, in some cases as long as eight or nine years. While it may seem like a good deal to have a case where nothing happens, it can create a tremendous amount of stress for homeowners who never know when they’re going to get kicked out of their homes.
In Queens, where thousands of homeowners were served notices of a foreclosure and nothing more, one court clerk who fielded their calls began to look for more information about their cases and, because there was no information in the system about them, was forced to tally up the numbers by hand. Eventually, the efforts of a single clerk led to the court calling in banks and borrowers to discuss their cases one by one. Ultimately, some were resolved, including cases where homeowners were able to obtain loan modifications for foreclosure filings dating back to 2007.
It’s a troublesome matter that loose ends of the financial crisis still linger for many, and that it sometimes requires the initiative and old-fashioned detective work of one person to ensure these cases are pushed through the system. Still, homeowners in this position can find positive benefits behind resolving their stressful situations and even working out arrangements that allow them to keep their homes.
If you were served a foreclosure notice and have not heard about your case, there is a possibility that the same situation may be happening to you. At Atlas Consumer Law, our Chicago consumer law attorneys can help you evaluate your available options, which may include modifications to your loan. Our team is readily available to discuss your situation and take the necessary steps to resolve your case, frustrations, and fears. Contact us today.