At 8:30 nearly every Monday morning, employees from Cuyahoga County's Sherriff Office stand in this windowless room in Cleveland's Justice Center to auction off hundreds of foreclosed houses.
Sheriff Office: Let's continue... sale no 202 case no 661321... Do I have a bid?
Hoping to buy are a few investors, bargain hunters and the rare person trying to save their house. Most often its lawyers from local law firms representing global financial institutions who claim property here. Though these days that's starting to change.
Sheriff's Office: Are there any bids? Not sold for want of bid.
With no bid, the lender can either try to sell at another sheriff sale or do nothing. Doing nothing means the foreclosure is not complete. Cleveland foreclosure attorney Larry Rothenberg says doing nothing is becoming more popular.
Larry Rothenberg: Lately lenders are finding that the cost to purchase property at sheriff sale and resell it and the likelihood of finding a buyer weigh against a decision to buy the property. And so it has becomes more likely than before that lenders are not entering bids at sheriff sales.
And that changes the foreclosure equation. Realty Trac's Rick Sharga says employees at his online foreclosure sales company have heard of other cities where lenders are walking away from foreclosures and worries it could spread.
Rick Sharga: There are some urban areas where you have had rapid price depreciation, where you also have extreme unemployment issues, and nobody's buying the properties. All those conditions need to be in place before a lender is going to be motivated to do what you are seeing happen now.
And when lenders don't complete a foreclosure action at sheriff sale, the house stays in the homeowner's name. Sharon Little says she was shocked to find out she still owns a rental property on this busy Cleveland street. She walked away from the house in 2006 when she declared bankruptcy. Since then, thieves have stripped the house of siding, copper plumbing, and even windows. She only found out her name is still on the deed when she got a summons last October to appear in housing court.
Sharon Little: Eventually they are going to tear this house down and somebody is going to have to foot the bill and frankly I think it should be the bank because its their house. It's not my house, really.
But not legally. The city of Cleveland is writing tickets for housing code violations to whoever is listed on the deed. Bus driver Curley Jackson has been on the phone with his loan servicers trying to convince them to foreclose on property he can no longer afford.
Curley Jackson : I surrendered these properties back to you all. I said you keep leaving them in my name and I am getting these tickets. They don't care. Theyre not getting these tickets. They're not getting threatened with jail.
Cleveland Housing Court officials say they are now seeing homeowners take matters into their own hands. Sharon Little, for instance, wrote up a deed and gave her house to her lender.
Sharon Little: That's because it was their house from the jump, so that's what we do, give it right back to them. You can keep your house. I don't want it.
Bankruptcy attorney Richard Nemeth has asked state lawmakers to propose a bill that would force lenders to completely follow through with foreclosure or forgive the homeowner's debt.
RIchard Nemeth: I mean, it's a really sad set of affairs when people don't want to touch a piece of real estate with a 10 foot pole.
County officials here hope that a new landbank will help solve this problem by giving lenders a place to dump unwanted property. But in the meantime, the city is forced to use scarce tax dollars to maintain or demolition some of these unwanted, foreclosed houses. Mhari Saito, 90.3.