Realty Exec’s Strategic Default Ends With $2.1 Million Old Town Sale
List Price: $2.149 million
Sale Price: $2.105 million
The Property: Chris Feurer, the CEO of the Chicago real-estate brokerage Jameson Sotheby’s International Realty, sold his 7,000-square-foot house in Old Town on February 4, approximately 16 months after he stopped making payments on his $1.8 million mortgage.
Feurer listed the house for sale in January 2012, asking $2.499 million (he’d lower the price two times in the following months). When the Florida-based lender BankUnited initiated foreclosure against him in March, he told Crain’s Chicago Business that he had intentionally stopped payments, planning to cover the debt amount, about $1.7 million, with proceeds from the sale of the house.
That tactic is known as strategic default; there is no reliable data on how many homeowners have tried it, but my ongoing research in local property records indicates it’s fairly common among high-end homeowners. It’s also sometimes called the Foreclosure Free Ride, a calculation by homeowners that they can skip payments for a long time before they are kicked out of their homes.
“We anticipated the sale would happen much quicker,” Feurer told Crain’s last May. “We notified the bank of our intentions and they’ve been working with us.”
In the 11 months since the initial notice of the start of foreclosure, the lender has not filed any further documents on this property with the Cook County Recorder of Deeds. That suggests that the bank may have been cooperating, as Feurer told Crain’s. He said then that the filing might have been “a case of one [department at the bank] not talking to the other.”
When I reached Feurer by phone on February 7, he asked me to email him my queries. I sent him several questions, but at press time, Feurer had not replied. His listing agent, Nancy Tassone, did not respond to a request for comment.
The five-bedroom house was a three-flat before Feurer’s father, Russell, bought it in 2001 for $675,000, according to county records. Crain’s reported that the father and son together converted it into a single-family home. Photos that accompanied the recent listing show a sunlit space with lots of exposed brick, custom cabinetry, and several levels of outdoor decks.
Chris Feurer obtained the deed from his father in August 2004; no amount was recorded for that transaction. On the same day, Chris Feurer took out a $1.8 million mortgage from BankUnited. In March 2012, BankUnited started foreclosure proceedings.
The buyers are not yet identified in public records of the sale.
Price Points: Feurer had told Crain’s that the house was not worth less than the mortgage debt. He turned out to be right: The sale price was 18.9 percent more than the $1.77 million that BankUnited sued to collect.