Bill Robinson
Register News Writer
Fri, May 16 2008
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Editor’s note: This is the third and final story of a three-part series about Madison County’s housing market.
Foreclosed properties referred to Madison County’s master commissioner jumped 45.6 percent in 2007.
Last year, 217 properties were referred to Master Commissioner David Baird to be sold at auction. That was up from 149 in 2006 and 136 in 2005.
The foreclosure rate is one housing market statistic for Madison County compares far less favorably with the rest of Kentucky.
Statewide, foreclosures increased 23.45 percent last year, according to RealtyTrac, which publishes real estate statistics on its Web site.
Not every property referred to his office goes on the auction block, Baird said. “Some property owners are able to make arrangements with their creditors before a scheduled sale.”
The same can be said about foreclosure actions filed with the circuit court clerk.
After a foreclosure action is filed, the clerk’s office sends a summons by certified mail or it is delivered by the sheriff’s department, according to a deputy circuit clerk. The defendant then has 20 days to respond. The case then goes before a circuit judge who decides whether to order a master commissioner’s sale.
Notice of local foreclosure sales are posted on the Madison County Courthouse door and advertised in the Richmond Register.
Perhaps the brightest statistic for the local and state housing markets last year was prices. Home prices declined 1.8 percent nationwide, but the average price in Madison County rose $1,650. In Kentucky, they were up 3 percent, according to Susan Helm of the Kentucky Association of Realtors.
Madison County’s decline in existing home sales last year, 5.9 percent, differed only slightly from the statewide percentage, 5.82.
The state and local markets still fared much better than the national market, which saw sales decline 13 percent in 2007.
New home construction across Madison County declined 14.4 percent last year, while the decline was 18.6 percent statewide and 24.8 percent nationally.
The outlook for home owners and potential home buyers brighten considerably late last month when the Federal Reserve Board reduced interest rates twice in less than 10 days.
Early this week, the market rate for 15-year fixed mortgages was slightly above 5 percent, two local lenders said. The rate for 30-year home loans was close to 5.5 percent. The rates fluctuate on a daily basis, they said.
New mortgage and refinancing loans are being written every day, said Bev Maybrier of Star Mortgage. For borrowers who qualify for Federal Housing Administration, Veterans Administration or Rural Housing Service loan, 100 percent financing is available.
Her firm even has a free credit counseling program available to help potential borrowers improve their credit rating or remove errors from their credit reports, she said.
“Contrary to the impression you might get from the national media, there is no ‘credit crunch,’” said Bill Walters, president of Madison Bank, The Federal Reserve’s rating cutting seems to be having its intended effect, he said. “Mortgage loan applications have picked up since the fed lowered the rates,” he said.
Borrowers who have equity in the homes, consistent income and good credit history can get a mortgage loan, Walters said.
Bankruptcies up 38%
Bankruptcy filing by Madison County residents increased to 276 in 2007 from 200 in 2006, an increase of 38 percent, according the Web site of the federal bankruptcy court in Lexington that serves 70 counties in the eastern half of the state. Bankruptcy filings in all those counties were up 31 percent for the year, from 5,296 to 7,684.
Bankruptcy statistics for 2005 were skewed because a more restrictive bankruptcy law passed by congress took effect that October, and many debtors rushed to take advantage of the old law. Bankruptcies in Madison County totaled 667 that year while 18,867 were filed in all the counties under the Lexington court’s jurisdiction.
Bill Robinson can be reached at brobinson@richmondregister.com or at 623-1669, Ext. 267.
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