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Monday, 02/21/05 Deployment may be why Clarksville area is No. 1 in foreclosures
By KEITH
RUSSELL
Staff Writer
Hearing that their town's 37042 ZIP code saw more foreclosures than any
other in Middle Tennessee last year brought one likely cause to the minds
of real estate agents and legal professionals in Clarksville.
The military.
The 37042 ZIP code is the closest in Clarksville to the Fort Campbell
army post that straddles the Tennessee-Kentucky line. As such, it is known
for being the home of a sizable portion of Fort Campbell soldiers who
choose to live off-base.
Last year, 326 foreclosures were recorded in the ZIP code, more than
double the 149 listed in 2003, according to Foreclosure.com, which keeps a
nationwide database of foreclosure properties for sale. By comparison, the
37013 ZIP code in Davidson County's Antioch neighborhood had the
second-most foreclosures with 187.
Several real estate professionals in Clarksville speculated that the
area's high foreclosure rate is the result of its concentration of
Veterans Affairs-backed home loans, which carry guarantees that could
mitigate the risk for a borrower who walks away from a mortgage on which
they've fallen behind.
Jill Whittinghill, a vice president with First Federal Bank in
Clarksville, said VA loans are always the highest percentage of loans the
banks sees wind up as foreclosures. Last year, nine of the bank's 31
foreclosures were VA loans, with six of the homes located in the 37042 ZIP
code. But Whittinghill adds that her bank didn't see a big jump in the
number of VA loans a year ago.
A more likely cause for the increase, many believe, can be attributed
to real estate investors who have been hurt by the 101st Airborne
Division's frequent deployments the past few years.
''What's happened up there is that a lot of houses or small apartment
complexes or duplexes are owned by landlords,'' including by some retired
military personnel, said Joe Prochaska, a Nashville attorney who assists
lenders with foreclosures. ''When the 101st deploys, those soldiers don't
pay rent anymore, and the landlords don't have the income stream to make
their mortgage payments.''
Jimmy Deatrick, a vice president with Crye-Leike Realtors in Mt. Juliet
who invests in foreclosure properties, said he thinks investors also are
behind some of the foreclosures elsewhere in Middle Tennessee.
''I have seen the names of several investors coming through the
foreclosure rolls,'' Deatrick said.
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