Beyond REO: Properties Transferred at Extremely Distressed Prices, Cuyhoga County Michael Schramm Center on Urban Poverty and Community Development Mandel School of Applied Social Sciences Case Western Reserve University

Diversions from the Pathway to Foreclosure Borrower Subprime Loan Default Foreclosure Filing Sheriff's Sale REO? Financial literacy Access to local banks Safe and sound products Targeted outreach Foreclosure prevention Foreclosure intervention or mediation Racial and geographic characteristics put certain borrowers at HIGH RISK

Foreclosure Filings, Cuyahoga County

Trend in Completed Foreclosures Prepared by: Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University. Source: NEO CANDO ( Cuyahoga County Auditor

Proportion of Sheriff’s Deeds by Grantee Category, 2000 vs Prepared by: Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University. Source: NEO CANDO ( Cuyahoga County Auditor

Prepared by: Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University. Source: NEO CANDO ( Cuyahoga County Auditor Prepared by: Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University. Source: NEO CANDO ( Cuyahoga County Auditor Sales Price Relative to Estimated Market Value (in 2007 dollars), City of Cleveland Year Sheriff’s Sale

Top Sellers of REO Properties, Cuyahoga County, Seller Number of REO propertie s sold, $10,000 or less Percent of total REO properties sold REO properties sold by seller, all prices Percent of REO properties sold for $10,000 or less by seller Deutsche Bank National Trust % % Wells Fargo % % Fannie Mae % % U.S. Bank National Association % % LaSalle Bank National Association % % Bank of New York % % JP Morgan Chase Bank % % HSBC Bank752.87% % Homecoming Financial Network732.79% % Wachovia Bank562.14% % Total (top sellers) % % Total REO properties sold Source: Cuyahoga County Auditor transfer data from NEO CANDO, Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University.

Top Buyers of REO Properties at $10,000 or Less, Cuyahoga County, Buyer Number of propertiesPercent of properties by buyer Destiny Ventures % Stonecrest Investments622.37% Blue Spruce Entities602.30% REO Nationwide532.03% Econohomes LLC321.22% Bryce Peters Financial Corp311.19% RECA301.15% Jeffrey Clark250.96% SL Holdings LLC220.84% BSB Investments LLC210.80% Total (top buyers) % Total REO properties sold2614 Source: Cuyahoga County Auditor transfer data from NEO CANDO, Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University.

Timing of Property Transfers Among Properties Leaving REO at $10,000 or Less, Time elapsed since previous sale Number of propertie s leaving REO (Transfer 1)% Number of properties resold (Transfer 2)% 0 to 90 days % % 91 to 180 days % % 181 to 1 year % % 1 year or more %579.12% Total * *2,316 properties leaving REO at $10,000 or less were either not transferred a second time during the study period, or a property transfer deed was not filed. Source: Cuyahoga County Auditor transfer data from NEO CANDO, Center on Urban Poverty and Community Development, Mandel School of Applied Social Sciences, Case Western Reserve University.

Misc stuff on extremely distressed prices NPI lawsuit against Deutsche and Wells (declare public nuisance, abate nuisance, declare business practice a public nuisance) Toxic titles – Banks walking away from foreclosures before taking to sale (decree of foreclosure granted by court, however no sale scheduled)

Ways data are being used in community Foreclosure prevention/early warning – Mortgages from Recorder flagged with High Cost and HUD subprime list lenders and First American Title adjustable rate data scrubbed against sheriff sales/water shutoffs Foreclosure intervention – Foreclosure filings that have not yet gone to Sheriff sale (served through NEO CANDO) Foreclosure reclamation – Sheriff sales that go to Banks/REO departments (served through NEO CANDO) Most of the data are now updated weekly

Who is using these resources Cleveland Housing Court Cleveland Tenants Organization Community development corporations Foreclosure counseling agencies (ESOP, CHN, NHS) Neighborhood Progress’s Strategic Investment Initiative (SII) (Opportunity Housing Foreclosure Pilot)

Combining data usefully Data sources are disparate –Parcel number is key However, more info is needed! –Parcels can have multiple sheriff sales, foreclosure filings, loans, etc –Originator, Plaintiff, Purchaser at sale are not the same entity –Need to use dates and ownership periods to determine which foreclosure/sheriff sale goes with which loan –County websites only allow search on a property or name, cannot do complex data queries