When a home is foreclosed upon, the homeowner will often vacate the premises. After all, the house is being taken back by the bank, whether the owner likes it or not. They take the opportunity to move on with their life and leave the house behind. But if the bank does not officially repossess the home, the owners are still responsible for taxes and other costs. This is called a zombie foreclosure.
These kinds of foreclosures are on the decline in Ohio. Across the nation, about 20,000 homes fit into this category at the end of last month. This is a drop of over 40 percent from last year. One such reason is that it has become more fiscally beneficial for the banks to actually repossess the homes and put them on the market, with the rise in house prices.
Around this time last year, there were more than 150 zombie foreclosure homes in central Ohio. This year, there are only about 90. But the truly concerning part of this story is the sheer number of abandoned homes. In central Ohio, this amounted to more than 8,000 houses. Across the nation, 1.5 million homes, nearly 2 percent of the total, are abandoned.
Experts say many of the empty houses were seemingly abandoned for no reason. Only about 10 percent were either in foreclosure or underwater. A large majority of them did not even have a loan on them; they were fully owned.
Even with the drop in zombie foreclosures, homeowners who are facing financial challenges may find themselves saddled with unnecessary payments because the bank did not go through the repossession process after foreclosure. Anyone who is facing foreclosure may benefit from speaking with a bankruptcy law attorney.
Source: The Columbus Dispatch, “‘Zombie’ foreclosures down in central Ohio, U.S.,” Jim Weiker, Oct. 8, 2015