Owning a home may be part of the American dream, but that dream is facing hard realities in Columbus and Lowndes County.
The 2010 third-quarter foreclosure rate in the county and city increased 32.4 percent compared to the same quarter last year, according to Chancery Court records.
Mortgage lenders sold 45 local foreclosed properties in July, August and September, up from 34 properties in that same time span in 2009.
Although third-quarter foreclosure filings decreased 35.5 percent on average across the state, the local foreclosure rate has climbed an average 6.6 percent since 2005, when mortgage lenders auctioned 96 repossessed houses.
So far this year, mortgage lenders have auctioned 130 foreclosed properties, mostly houses, and another 32 properties are scheduled for public auction in October and November at the Lowndes County Courthouse.
The increase in foreclosed homes is likely due to the troubled economy, said Jeff Farnham, president of locally-owned JTS & Company Mortgage Brokers.
Most often, houses are foreclosed on because of some catastrophe, like when people lose their jobs, Farnham said.
“They obviously can”t (make their payments),” he said.
One in every 885 homes in the state received some sort of foreclosure-related notice during the third quarter, according to foreclosure-tracking company RealtyTrac. The company ranked Mississippi 46th nationally in the rate of foreclosure actions.
As the housing market continues to fluctuate, savvy investors and homebuyers have gravitated toward foreclosures, which usually sell for less than their market worth.
But allegations that some mortgage lenders have mishandled documents and made illegal foreclosures could cause buyers to look elsewhere.
Also, foreclosures in the fourth-quarter will likely be down as lenders temporarily halt repossessions, said RealtyTrac CEO James Saccacio.
Four of the nation”s largest banks — JPMorgan Chase & Co., Ally Financial”s GMAC Mortgage unit and PNC Financial — have stopped foreclosures in some states.
The biggest bank, Bank of America Corp., has done so in all 50 states. JPMorgan has done so in 41. The banks say they expect to resume foreclosures in those states within weeks.
Meanwhile, officials in 50 states and the District of Columbia launched a joint investigation Wednesday into allegations that some mortgage lenders mishandled documents and made illegal foreclosures.
Mississippi Attorney General Jim Hood, who is heading up the state”s probe, said he did not anticipate finding any illegal activity.
“I don”t think we”ll see any problems with (lenders) in Mississippi,” Hood said.
The goal of investigators is to quickly examine whether people were forced out of their homes illegally and allow lenders to begin legal repossessions, Hood said.
“We want to make sure we create some stability in our real estate market,” he continued. “We can”t afford any more instability in the market right now.”
The Associated Press contributed to this story.
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