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Foreclosure numbers in Campbell continue to climb

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By Susan Sharp

As mortgages lapse into foreclosures lenders and homeowners alike have had to prepare for the worst.

While the fallout from a sub prime lending market has been felt across the country, Campbell County has not been immune to the losses.

In 2007, 12 local homes were lost due to foreclosures, according to property assessor’s records.

The next year, 2008, the number grew five times with home losses totaling 69 in the county. And with the figures in for the first three months of 2009, it seems history could repeat itself.

From Jan. 1 until March 23, 34 Campbell County homes slid into foreclosure status, property assessment records said.

The downward trend appears to have begun in mid- 2008 with the month of July recording nine homes going into default status. As the year ended, October and November had a combined 25 homes being repossessed, the records said. That number was double the amount of 2007 total losses. The first three months of this year have recorded nearly half of the 2008 total.

“I have seen a lot (of foreclosures) come across my desk,” said Campbell County Property Assessor Brandon Partin.

Partin’s office is just one stop in a long paper trail involving a loan default.

After a foreclosure notice passes through his office and the register of deed office the property is offered for sale in an auction that actually occurs on the steps of the courthouse.

‘There is a list that has to be read. It’s called a public outcry,” Partin said.

From there the bidding begins.

The hope is for a bid that will cover the balance of the note, Partin said. However, the financial companies reserve the right to reject bids, holding onto the property, he said.

In the event of no bids at all, the financial institution retains the property.

However, for most lending companies that isn’t what they aspire to.

“We don’t want the house back,” said First National Bank President Marvin Minton. “We want to work with clients so they don’t lose their homes.”

Sitting down with homeowners and trying to help them work through their financial crises is the preferred method for lenders. Taking into account each person has a different story and set of circumstances, Minton said, “trying to work the loan” is the preferred method of solving a hardship.

However, when that fails, other measures must be taken.

“Sometimes we go and knock on the door,” he said of homeowners who have not met their obligations or tried to work with the bank.

While Campbell County lenders have not recorded near the losses of large national mortgage companies, Minton said his bank has seen an increase in the number of homes reverting to the bank as the owner.

But for the most part, local banks have been able to lessen the blow by being proactive on the front end.

“We did smart loans,” said First Volunteer loan officer Melissa Smith. “So fortunately we have not had to do a lot of foreclosures.”

Minton agreed that sensible measures have been key for his bank and many others not registering as many losses.

“That (sub-prime) says it all. Think about the name,” he said noting his bank chose not offer those loans.

Logan Hickman, vice president at People’s Bank of the South, said cautious lending had been key for his bank dodging the financial snowball as well.

“We consider ourselves a conservative financial institution,” Hickman.

Utilizing practices such as not allowing more than 80- percent of the home’s value to be leveraged against it is just one procedure People’s Bank abides by, he said. Hickman’s bank also asks prospective homeowners to place a down payment on the home.

“Stuff you don’t put anything into you can walk away from,” Hickman said. “When you put money down, you figure out a way to make the payment.”