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Monday, April 13, 2009

Ind. Courts - "Uncontested foreclosure cases on the rise in Lake County"

Here is a long list of earlier ILB entries on the mortgage foreclosure crisis.

Today Marisa Kwiatkowski of the NWI Times has this report. Some quotes:

Most down and out region homeowners aren't battling mortgage foreclosures in court, a Times review of county court records shows.

Nearly 60 percent of foreclosure cases in Lake and Porter counties are disposed of by default judgment, meaning the homeowners never contacted the court or showed up for hearings, county court statistics show.

Lake County judges told The Times about 90 percent of their mortgage foreclosure cases are decided on paper.

"I can't even recall having a hearing in the last year," Lake Superior Court Judge Diane Kavadias Schneider said of residents' involvement. "It's a really bad situation, but I'm hopeful it's going to get better."

Stephanie Shappell Katich, head of Indiana Legal Services' foreclosure defense unit, said homeowners sometimes believe they deserve to be kicked out because they haven't paid their mortgages. Others don't understand the legal documents that are sent to them.

Homeowners in foreclosure who were contacted by The Times either did not return phone calls seeking comment or declined to be interviewed, saying they were embarrassed.

Officials blame predatory lending and a faltering economy for the steady increase in mortgage foreclosure cases.

Foreclosure filings have increased every year since 2002 -- the first year such cases were put in a separate category by the state court administration. More than 43,800 cases were filed statewide in 2007, which is 47.3 percent higher than 2002, state data shows. * * *

The Legislature is considering a bill that would require mediation before or during mortgage foreclosure cases. The hope is residents will be able to negotiate loan modifications that keep them in their homes.

Marion County recently issued a local rule that requires creditors to offer settlement conferences for owner-occupied residential foreclosures.

Chief Lake Superior Court Judge John Pera said Lake County judges are considering creating a similar requirement but will wait on the Indiana Legislature. * * *

[Katich, of the Indiana Legal Services' foreclosure defense unit] said an upside to the mortgage foreclosure crisis is the attention cases now are being given.

"It's more than simply a question of did you make your mortgage payment," she said. "There are legal defenses."

She urged homeowners to contact attorneys as soon as foreclosure cases land in court.

"Get a lawyer," she said emphatically. "Get a lawyer. ... the minute that complaint is filed. Every day you wait you are further jeopardizing the defense and your rights."

Here are the relevant bills still alive this year: SB 225 - foreclosure and tenants; SB 492 - Consumer practices and residential mortgage foreclosures; HB 1081 - Rental property foreclosure notices. A fourth bill, HB 1633 - Foreclosure of residential mortgages - appears to have died in 2nd house committee.

See this ILB entry from March 19th for more on the Marion County trial rule offering a settlement conference.

Posted by Marcia Oddi on April 13, 2009 09:14 AM
Posted to Indiana Courts