In a previous post we discussed the problem of zombie foreclosures in Florida. The problem of these lingering foreclosures has persisted, and experts now estimate that over 300,000 homes are in a state of partial foreclosure, which adds up to more than one-third of all foreclosed properties in the United States.
As we’ve discussed in the past, the term “zombie foreclosure” was coined by the media to describe homes that were vacated by owners but never fully foreclosed upon by the banks. Many homeowners do not realize that they are involved in a zombie foreclosure until a year or several years later when the banks and the government where the house is located track them down and demand property tax payments.
In addition to property taxes, homeowners with a zombie foreclosure still on their balance sheet can also be responsible for lingering costs like electricity that was never shut off or fines from the city for improper lawn maintenance. These debts can become a serious financial burden and could eventually impact one’s credit score if they are considered delinquent.
Florida still has the highest number of zombie foreclosures out of all of the states in the nation, with a total of approximately 91,000.
The lesson for Florida homeowners is to stay apprised of the status of a foreclosure and not to vacate a home or give up on a mortgage too early. Many people see a foreclosure notice and assume that there is nothing they can do, but in fact there are some options that can help keep people in their homes.
Source: Chicago Tribune, “Zombie foreclosure statistics scary,” Mary Umberger, April 19, 2013.
Information about foreclosure prevention is available on our Orlando bankruptcy site.