Cities In Ruin Due To Foreclosure Crisis
During a meeting with visitors at the Trenton City Hall, mayor Douglas Palmer pointed on to a large map with black dots scattered all over it. Each dot represented an empty home on the verge of foreclosure. There were dozens all over the city. Furthermore, the black dots only represented properties identified by the Mercer county sheriff’s department as being at risk where as, as Douglas Palmer pointed out, there are several more that they don’t even know about yet.
The foreclosure crisis is biting deep in
Trenton, New Jersey. The mayor said that some of the people facing high mortgage payments were even afraid to talk about. He claimed that almost half of them don’t even bother calling their lender when they run into trouble.
Mr. Palmer said that the challenge is to prevent more black dots, representing abandoned houses, from appearing on the map but his resources are limited. Like many U.S cities
Trenton has seen foreclosure surge as a large number of people face mortgage payments at higher rates that they can afford and this has threatened to overturn the years of revival the city has seen under Mr. Palmer.
According to the mayors office over 600 properties faced the imminent threat or went into foreclosure in 2007 as compared to 421 in 2006. Collecting data from a number of sources the mayors office claimed that this number was expected to continue rising this year. As of December 260 properties were identified by the sheriff’s office as being in danger of foreclosure.
Mr. Palmer has more on his hands than just
Trenton. He is the president of the U.S Conference of Mayors which is set to meet in
Washington and has set foreclosure as its top priority. They claim that the plan brokered by the Bush administration to provide relief to troubled borrowers does not help those that are already in the process of losing their homes due to foreclosure.
Mayor Palmer fears that neighborhoods that were built focusing on affordable homes for middle income families will suffer the most as foreclosures rise since these are the neighborhoods where mortgages are mostly strong. As foreclosure rises, homes will become shuttered, crime will worsen and property values will decline.
Trenton police have reported an increase in copper pipe thefts as vandals raided unoccupied homes around the city.
Some cities are blaming the mortgage companies for the crisis.
Baltimore sued Wells Fargo & Co accusing them of exploiting the minorities. While other cities, such as Cleveland, New York, and
Buffalo have held the lenders responsible for the maintenance of homes facing foreclosure. A professor at Dartmouth
College’s Tuck School of Business studying property sales claimed that this was going to be a crisis for some cities.
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[...] Foreclosure Home wrote an interesting post today onHere’s a quick excerpt [...]
Unfortunately, the social stigma of taking out a loan and being unable to pay it back contributes a lot to the foreclosure problem in the first place. Homeowners are afraid to admit their mistakes and lenders are unsympathetic, at best, and their practices can verge on harassment at times.
It’s no wonder that the bureaucrats are involved now, when property values are declining and property tax revenues may also decline. A little too late to “protect life, liberty, and property,” as well as protect their own interests in maintaining high values.