Atlanta is among the nation’s hardest-hit markets for foreclosures according to a Harvard University scholar. The large numbers of subprime loans, extensive mortgage fraud, and large quantities of housing stock are the identified causes of this current increase.
Mark Duda, the Harvard researcher who is analyzing national foreclosure trends for a study sponsored by the Fannie Mae Foundation, said Thursday that the high foreclosure rates produced by failing subprime loans are costing communities millions of dollars in hidden losses.
“When there’s a foreclosure, it causes other problems,” Duda said.
Properties surrounded by foreclosures will often see their property values decrease as a result. This is largely in part due to the increase in crime in these concentrated areas where foreclosed and vacant structures seem to promote criminal activity.
In Georgia, failing subprime loans also boost the per capita rate of Chapter 13 bankruptcy filings to three times the national rate. The state’s short window between the declaration of foreclosure and seizure of the property sends many homeowners to bankruptcy court to stop the sale while they attempt to restructure their debt, Duda said.
Comments(0)