2009 Chicago Foreclosure Report: Financial Crisis Is Far From Over

Every 22 minutes a home goes into foreclosure in Chicago.

With the largest number of homebuyers of any metropolitan area in the nation, Chicago provides a snapshot of not only the latest urban real estate trends, but also the economic well-being of American households across all income levels.

Our homes continue to be our single largest purchase, our largest source of household wealth, and unfortunately our largest source of debt. On the family level, a foreclosure almost always reduces household wealth. On the community level, foreclosures negatively impact home values and reduce the wealth of other households. And, as we have painfully witnessed in recent years, when there are a huge number of home loans going bad it can even cripple the nation’s financial system and economy.

For over a decade this annual Chicago Foreclosure report has documented the rise in risky, often predatory, home mortgage lending that frequently results in foreclosure. Ten years ago, the Chicago Foreclosure report witnessed an increase in foreclosures following the initial wave of subprime home lending in the 1990’s in lower income, majority African-American and Latino neighborhoods.

Years before the housing bubble burst and brought the pain of foreclosures to the upper-middle class and high growth markets, abuses in the subprime housing markets and the resulting foreclosures had already began to devastate Chicago’s most vulnerable neighborhoods. Then came the boom years of the subprime-fueled housing bubble (2004-07) when the entire mortgage industry raced to make or buy massive volumes of risky home loans, which were sold as investment products for a quick profit.

We saw loan quality hit rock bottom and then the foreclosures spiked upward in 2007. By 2008, the crisis went full-scale as foreclosures raged across the greater Chicago region. The 2009 Chicago Foreclosure Report provides an on-going look and the impact of the foreclosure crisis.

Download the full report below: