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04/11/2007

Consumer education vital to avoid getting stuck in a foreclosure

It's sad, but not surprising, to hear that home foreclosures are up in Lorain County, given the job losses in Lorain and Elyria in recent years. However, it is surprising -- and disturbing -- to learn that the foreclosure problem now is even gnawing more deeply into the county's upscale, growing communities of Avon, Avon Lake and North Ridgeville.Overall, Lorain County suffered 40 percent more foreclosures in the first three months of 2007 than in the comparable period of 2006. In the city of Lorain, the increase was 41 percent, and in Elyria it was 25 percent.

But Avon Lake saw a 143 percent leap in foreclosures.

North Ridgeville foreclosures shot up by 76 percent.

Avon foreclosures went up nearly 55 percent.

It appears that Lorain County's financial cancer of foreclosures is metastasizing into the middle class, according to Ron Nabakowski, the Lorain County clerk of court. He said he expects to see more than 2,500 foreclosures across the county this year, up from a record 1,930 foreclosures in all of 2006.

Of course, the actual number of foreclosures is higher in the more-populous, less-affluent areas. Of the 627 foreclosures across the county this year so far, 218 were in Lorain and 135 were in Elyria. North Ridgeville has 51, Avon Lake has 34 and Avon has 17 to date. Still, the rise in the foreclosure rate in those growing communities is worrisome.

Consumer education is crucial to help homebuyers avoid foreclosure problems. Be sure you are not taking on more debt than you can safely handle when buying a home. Nabakowski identified adjustable rate mortgages as one of the reasons for the jump in home foreclosures in this area. As he told our reporter, ''You get an awful lot of people who start out with low rates, but the rates don't stay low forever.''

Learn all you can from reputable sources before taking on a mortgage. If you do get into financial trouble, don't just wait for the ceiling to cave in on you; there are ways to resolve such problems short of foreclosure, but borrowers must promptly contact their lenders.

One source of information on dealing with mortgage payment problems and avoiding foreclosure is at www.freddiemac.com/corporate/buyown/english/owning/avoid_foreclosure.html

Many economic forces are at work in creating the foreclosure problem in Lorain County, across Ohio and the nation. But consumers can best protect themselves by becoming well-informed and savvy enough to avoid potentially troublesome mortgages before signing the mortgage papers.