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Neighborhoods escape shadow of foreclosures

Neighborhoods escape shadow of foreclosures. Five years after the Great Recession, fewer homeowners are falling behind on mortgages and losing their houses. Buncombe County is down to 248 foreclosure filings so far this year, from the peak of 1,376 in 2010. But Tom Luzon is still worried.

A shrinking but still sizable shadow inventory of homes that are headed toward foreclosure haunts the improving real estate market. These properties seized by banks typically sell for a reduced price, depressing appraised values for their neighbors.

“The foreclosure crisis touches all of us,” said Luzon, who heads the Mortgage Protection Program for Western North Carolina. “You might say ‘I don’t have a mortgage on my house. I own it free and clear.’ What happens to your free-and-clear house when your neighbor to the right gets foreclosed? And the one to the left. Your equity goes down the tubes.”

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