Wisconsin court system responds to mortgage foreclosure crisis
Madison, Wisconsin - January 14, 2009
Please note: This press release was revised on Jan. 15, 2009 to reflect correct figures for Pepin County.
Reflecting a national trend, the number of mortgage foreclosure filings in Wisconsin jumped 21 percent, from 2007 to 2008, figures compiled by the Director of State Courts Office show.
Foreclosure filings statewide, excluding Portage County, increased from 21,051 in 2007 to 25,474 in 2008 – the second consecutive year during which foreclosure filings increased more than 20 percent, said Director of State Courts A. John Voelker.
In an effort to prepare for the influx of cases, and to protect the rights of both creditors and borrowers, court administrators began tracking the number of foreclosures many months ago, said Supreme Court Chief Justice Shirley S. Abrahamson.
The court system has provided educational programs on mortgage laws and regulations for judges and court staff, and some judges have developed procedures to help ensure litigants are communicating in an effort to settle their disputes.
Also, Abrahamson and Voelker said the court system is communicating with court systems across the country to examine which programs may best help the parties resolve the difficult issues fairly and facilitate settlement, if possible.
One program – an alternative dispute resolution program started in other states – is being piloted in Wisconsin by Chief Judge William D. Dyke, Iowa County Circuit Court.
Dyke initiated a local rule that requires lenders who file a foreclosure action as of Jan. 1, 2009 to notify defendants that foreclosure mediation is an option under the state’s alternative dispute resolution statute. Foreclosure filings in Iowa County jumped from 58 in 2006 to 92 in 2007 and 105 in 2008.
“We’re fostering a discussion between the parties, and that discussion can take into consideration the loss of a job, for example,” Dyke said.
The mortgage crisis is affecting the system, but it doesn’t have to be devastating to the courts or the parties involved, Dyke said.
Judges, clerks of court and district court administrators report that in many foreclosure actions, the borrower is not represented in court. The increase in filings also will increase demand on the court system’s resources for self-represented litigants.
The foreclosure crisis is just one of several issues courts are coping with nationwide as economic struggles continue.
In a Dec. 8, 2008 article, The National Law Journal asked: “Is the Legal System Ready?” The article, written by Bernice Leber, notes home foreclosures and unemployment are near all time highs. Financial hard times are trickling from Wall Street to Main Street, and the courts will play a significant role as reverberations from the financial crisis sweep across the nation, Leber wrote. Nationally, the number of homes lost in foreclosure was up 51 percent from 2006 to 2007, and that rate was expected to be even greater in 2008.
The largest percentage increase was in Adams County, where filings increased 80 percent, from 123 to 222, followed by Vernon County, where filings increased 67 percent, from 45 to 75. The largest numeric increase occurred in Milwaukee County, where foreclosure filings increased 14 percent, from 5,683 to 6,468. The next largest numeric increase was in Dane County, where filings increased 46 percent, from 897 to 1,312, followed by Racine County, where filings increased by 295, from 806 to 1,101, or by 37 percent.
Court Information Officer