There's about 76-thousand single family homes in Winnebago County. As of now, 95 of them have gone through foreclosure and are up for sale. This is much better than the national average, where one out of every 134 homes went into foreclosure. But, locally It's expected to get worse.
For new homeowners Robin and Tom Rodriguez, missing two months of mortgage payments can put a major dent in their future plans.
"We're hoping that we'll be able to purchase a new home but with foreclosure on our credit it's almost impossible," Tom says.
Health problems have left Tom unemployed, which is one of the most common reasons for foreclosure along with death and divorce. Plus up until recently, mortgage companies were granting loans to individuals with low credit scores and smaller salaries.
"Loose guidelines are allowing undisciplined people to purchase things they may not be able to buy in the past which eventually will catch up to them," says Terry Bloom, President of Janan Mortgage.
Foreclosures filed in Winnebago County went up eleven-percent between 2005 and 2006. A little more than a-thousand foreclosures have been filed so far this year. And for those with adjustable-rate mortgages, some are fearful those numbers will continue to rise.
"Now that we have tighter guidelines their not gonna refinance out of their adjustable rate mortgage which is going to put them in a very tight crucial situation that might lead to foreclosure," Bloom says.
But for future home buyers, stricter guidelines will be a good thing. Because most properties will be owned by those who can afford them, which will help keep foreclosure rates low.
Mortgage experts say homeowners in Winnebago County take on more conservative loans than those living in other areas. So while some sign up for more than they can afford, the biggest reasons for foreclosure here are unemployment and divorce.