Ohio foreclosure filings set new record in 2009, top 89,000

Cuyahoga County Again Ranks First in Rate, Non-Urban Counties Lead in Growth Rates

Sixty-four of Ohio’s 88 counties saw an increase in foreclosure filings last year, and in 34 counties, filings grew by double-digit rates. While urban counties continue to lead the state in foreclosure filings, smaller and less urban counties are experiencing larger growth rates.

A new report released today by Policy Matters Ohio analyzes foreclosure filings and other housing trends in Ohio and its counties. Statewide, foreclosure filings continued to grow in 2009 with 89,053 new foreclosure filings, a 3.8 percent increase since 2008. Compared to ten years ago, when Ohio had 31,229 new foreclosures, this is a 185 percent increase. The latest numbers indicate that there was one foreclosure filing for every 56 housing units in the state last year.

The gain in filings is particularly crippling to the state, coming after years of increased filings and the broadest foreclosure prevention attempts to date, according to the study. Statewide, filings have more than quintupled since 1995.The study reviews federal efforts such as the HAMP program to curb foreclosures, finding dismal results. Nearly one-third of Ohio mortgage holders are “under water”, owing more than their houses are worth, and one in every six homeowners is either delinquent or in foreclosure.

“The number of foreclosures in the state remains at crisis levels and all signs point to more growth,” said David Rothstein, Policy Matters researcher and author of the report.

Cuyahoga County led the state once again in foreclosure filings per person, followed this year by Lucas, Clinton, and Highland counties. Morgan County led the state in foreclosure-filing growth between 2008 and 2009, with a 129 percent increase. Seven of the top ten counties in foreclosure-filing growth – each of which saw at least a 26 percent increase last year – were in the Northwest and Appalachian regions of the state.

Foreclosure filings continue to be most heavily concentrated in the state’s urban counties, accounting for 61 percent of filings. However, non-urban counties continue to experience large foreclosure growth

rates. The report chronicles that counties with populations less than 200,000 had higher foreclosure growth rates than the state average. For instance, the 60 counties with a population of below 100,000 saw overall foreclosure filing growth rate of 8.78 percent, up from 3.3 percent the previous year.

"It is up to Ohio," said Rothstein. “Federal efforts are falling short and the state has the ability to help homeowners and stabilize communities.”

The report recommends that the Ohio legislature pass reasonable reforms to encourage real loan modifications and reduce the foreclosure filing rate. These include regulating loan servicers, funding housing counselors, increasing tenant notifications and protections during foreclosure, and preventing foreclosure rescue scams.

Ohio Supreme Court Report Shows that Ohio Foreclosures Increased in 2009

Supreme Court Numbers Show Total of 89,053 During Year

Ohio foreclosure case filings in 2009 again set a record, according to data released on February 17, 2010 by the Supreme Court of Ohio.

Common pleas courts across Ohio last year reported 89,053 new residential and commercial foreclosure case filings, marking the 14th consecutive annual increase. However, the increase in 2009 (3.8 percent) reflects the relatively steady, yet modest, increases of the past few years (5 percent in 2007 and 3 percent in 2008), which is notably slower growth than was seen in 2005 and 2006.

A quarter of Ohio’s 88 counties experienced a decline in foreclosure case filings in 2009 compared to 2008 with the remaining counties showing an increase in year-over-year foreclosures case filings except for Lawrence County, which held steady.

Morgan County showed the highest percentage increase (129.7 percent) in 2009 while Allen County showed the highest percentage decrease (30.7 percent). As for raw numbers, Cuyahoga County experienced the most new foreclosure case filings in 2009 with 14,171, although this total is less than the foreclosure case filings recorded in 2007. Noble County reported the fewest foreclosures case filings in 2009 with 32.

Some Ohio Foreclosure Law

By Judge James L. Kimbler
A recent Ninth District Court of Appeals decision out of Summit County, Emerson Tool, L.L.C. v. Emerson Family Ltd. Partnership, 2009-Ohio-6617 addressed the issue of whether an entry ordering a foreclosure is a separate and appealable issue from an entry ordering a sheriff's sale. In paragraph 13 of Judge Whitmore's opinion, the following language appears:

"In a foreclosure action, the decree of foreclosure and the order confirming sale are separate and distinct actions, both of which constitute final appealable orders once entered. Citifinancial, Inc. v. Haller-Lynch, 9th Dist. No. 06CA008893, 2006-Ohio-6908, at 5-6. See, also, Bankers Trust Co. of California, N.A. v. Tutin, 9th Dist. No. 24329, 2009-Ohio-1333, at 14; Triple F Invests., Inc. v. Pacific Fin. Servs., Inc. (June 2, 2001), 11th Dist. No. 2000-P-0090, at *3. “The distinction is not merely academic, but has important procedural implications.” Smith v. Najjar, 163 Ohio App.3d 208, 2005-Ohio-4720, at 11. Before entering an order confirming the sale, a trial court must determine that all the statutory requirements for the sale have been met. R.C. 2329.31 (requiring that the trial court first determine if “the sale was made, in all respects, in conformity with sections 2329.01 to 2329.61 of the Revised Code” before issuing an order confirming the sale). See, also, Najjar at 10; Tadmor v. Huntington Natl. Bank, 9th Dist. No. 23021, 2006- Ohio-3818, at 5. Because the confirmation of a sheriff’s sale is a special proceeding, it is a final appealable order under R.C. 2505.02(B)(2). Metro. Bank & Trust Co. v. Roth, 9th Dist. No. 21174, 2003-Ohio-1138, at 12, citing Citizens Loan & Savings Co. v. Stone (1965), 1 Ohio App.2d 551, 552-553."

The syllabus in the Citizens Loan & Savings Co. case cited by Judge Whitmore lays out who has standing to file an appeal of a order confirming a sheriff's sale. The syllabus reads as follows:

1. Confirmation of a sale in a mortgage foreclosure proceeding is a special proceeding, and the order of confirmation is a final order appealable by the mortgagor. The purchaser at the sale is a party entitled to be heard upon confirmation and a party to the appeal.

2. The determination of the amount due on the debt in a foreclosure proceeding is not a money judgment.

3. A confirmation of a sale in a foreclosure proceeding requires a true hearing, including an opportunity for interested persons to be heard.

4. The mortgagor's right to redeem exists and may be exercised as an absolute right until confirmation of the sale. It cannot be cut off prior to confirmation, and the purchaser at the sale acquires no vested right to the property until after confirmation.

5. Where the only lien adjudicated to be valid has been redeemed by payment prior to the sale, there is no substantial reason to proceed with the sale, and it is error thereafter to confirm such sale. A purchaser at such a sale who was aware of the redemption before sale is not entitled to interest on his deposit from the person holding the mortgagor's title.

The Ohio Supreme Court upheld the power of a court of common pleas to adopt a local rule allowing for ex parte consideration of confirmation orders in Union Bank Co. v. Brumbaugh (1982), 69 Ohio St. 2d 202. In that case, the Ohio Supreme Court held that under the Modern Courts Amendment ( Ohio Const. Art. IV, § 5(B)) to the Ohio Constitution, local rules adopted pursuant to a the Ohio Rules of Civil Procedure controlled if they conflict with prior court decisions or statutes. In the Union Bank case, the Supreme Court found that the holding in the Citizens Bank case that a trial court had to conduct a full hearing prior to confirming a sheriff's sale conflicted with the local rule. Therefore, the local rule controlled.

The Ohio Supreme Court also issued a ruling in another case that dealt with the legal principle set forth in the first paragraph of the syllabus in the Citizens Bank case. In Ohio Sav. Bank v. Ambrose( 1990), 56 Ohio St. 3d 53, the Court wrote the following in its opinion syllabus:

Purchasers at a foreclosure sale have no vested interest in the property prior to confirmation of the sale by the trial court. As a result, the purchasers have no standing to appeal when the trial court denies confirmation.

In summary, then, it appears that under Ohio law:

1. The judgment entry granting the foreclosure and the judgment entry confirming the sheriff's sale are both final and appealable orders;

2. A common pleas court does not have to hold a hearing before signing an entry confirming the sheriff's sale;

3. A mortgagor has a right to redeem the property prior to confirmation of sale; and

4. If confirmation is denied, the buyers at the sheriff's sale have no standing to file an appeal.