Ohio a national leader in zombie foreclosures, statistics show

Many people think that once they receive a notice of foreclosure, there is little they can do to save their home. As a result, some people decide to move out and abandon the property. In a standard foreclosure, the lender or mortgage company completes many necessary steps in order to get to the point where they sell the home at a Sheriff sale to a new owner. Although this full process does happen in some instances, sometimes the mortgage company does not complete all the steps in order to sell the house. In the event that the foreclosure stalls or is dismissed by the court, homeowners who have abandoned their homes can find themselves in very tricky situations.

The "zombie" foreclosure

An incomplete foreclosure is sometimes called a "zombie" foreclosure. This happens when a homeowner abandons her home during the foreclosure process, but the mortgage company does not complete the process by selling the house to a new owner.

There are many reasons why a foreclosure may not be completed. Sometimes the mortgage company does not have all of the correct paperwork. Sometimes the mortgage company decides that it is not a house worth selling (or buying back). Sometimes the reason is not known. The end result, however, is that the homeowner who moved out of the home is still the owner of the property and is still responsible for it.

Owning a vacant, abandoned home can cause many problems for the homeowner. In some cases, homeowners are still responsible for the costs of ownership, such as property taxes and HOA dues. Another common problem is that the vacant home can fall into disrepair or be the victim of vandalism, making the deed owner (in this case, the homeowner) liable for fines and zoning code violations. Sometimes the violations can even be criminal in nature.

Homeowners who have abandoned their homes are often unaware of these accrued costs, as they assumed that the foreclosure was completed. As a result, they can find themselves hit with unforeseen expenses at a time when they are already struggling financially.

Avoiding zombie foreclosures

Unfortunately, zombie foreclosures are a major problem in Ohio. According to RealtyTrac, Ohio had 7,400 zombie foreclosures in the last quarter of 2014. This was enough to make it the state with the sixth highest number of zombie foreclosures in the nation.

If you are faced with a foreclosure, it is generally not a good idea to abandon the property. If you would like to keep your home, filing Chapter 13 bankruptcy can be a viable solution. During Chapter 13, you repay your overdue mortgage payments in monthly installments during a repayment period lasting three to five years. As long as you make the affordable payments each month, your lender may not foreclose on your house.

Even if you do not want to keep the home, there are various legal options that, when completed, can ensure that you are no longer liable for the mortgage or the costs of owning the home.

No matter what your situation, it is important to seek legal help when you are having trouble making your mortgage payments. The experienced bankruptcy attorneys at The Rose Law Office can assess your situation and recommend the best solution that will help you accomplish your goals and protect your long-term interests.