A sharp rise in foreclosures in many neighborhoods around Chicago is making its mark in the real estate market in the city. Foreclosures were up an astounding 44 percent during the first quarter in Cook County.
A total of 10,837 foreclosure filings went through during the first quarter of 2008, up from 7,503 filings during the same period in 2007, according to records from the Cook County Circuit Court. The rise in foreclosures comes as many subprime loans are reset to higher interest rates, leaving many low income homeowners unable to pay the higher mortgage costs.
The rise in foreclosures has hit poorer neighborhoods particularly hard. Long-time renters were able to buy a home due to easy credit approval and lax lending practices. However, as rates rise, many homes are now sitting empty around Chicago.
Austin was the neighborhood hit hardest by foreclosures. More than 800 homes were foreclosed during 2007, the highest number for any Chicago neighborhood. The once booming area is now faced with signs of urban blight, with boarded up homes and abandoned lots becoming far more common.
The federal government is working on plans to help homeowners who are facing foreclosure in coming months. A freeze on interest rates could help many distressed homeowners throughout the Chicago region. However, for many owners of Chicago Homes around the city, it is already too late.
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