LEXINGTON, KY -- The housing slump has hit central kentucky full force, with more and more owners trying desperately to dump their homes, and unload their mortgagtes reports the Lexington Herald-Leader in its Saturday edition.

They gather at the courthouse, bidders willing to take a gamble on something off the scrap heap of foreclosed properties that have been dumped there by the mortgage crisis and financial meltdown.

Every week now, there is a list of homes and properties whose owners couldn't keep up with the payments — properties repossessed by banks and mortgage companies and put back on the market for somebody to try to salvage and turn back into the American dream.

"Foreclosures are occurring in practically every subdivision in Fayette County. No area is immune," said Don Swain, who buys foreclosed-on properties.

The majority are in in lower price ranges, under $150,000 in value. But earlier this year, a house appraised at $800,000 in McMeekin Place was sold foreclosed.

There have always been foreclosures. But starting in late 2007, the scrap heap started piling higher and deeper, forcing the Fayette Circuit Court's master commissioner, the court officer in charge of auctioning off foreclosed property, to schedule foreclosure sales every Monday, instead of every other week, reports the Herald-Leader.

"In years past, we never sold in December. This year, we're selling up to Dec. 22," said James Frazier, Fayette's master commissioner. Frazier said he had no choice. "Lenders are screaming. They want their money, or they want the property."

While Lexington and Kentucky have not suffered the same kind of economic pain that boom-and-bust states such as Florida and Arizona have endured, it has had its share of homeownership dreams shattered. And sometimes the homes haven't even been completed, the Herald-Leader reports.

Already there are more than 300 properties scheduled for sale through March 2009.

Many of the homes that Frazier auctions were bought with an adjustable-rate mortgage that began with an interest-only payment. "Then the adjustments get made; people just can't afford the the payments," he said. "It's more of a house than they should have been in in the first place."

The final step often comes at the courthouse, as the lender tries to recoup its money from a homeowner who has defaulted. The bank either takes back the home or sells it at a foreclosure auction, the newspaper reports.

In 2008, the master commissioner received 926 court-ordered referrals to sell; 95 percent were homes. One order could contain multiple properties.

On Dec. 22, Frazier has three referrals, but one is a builder with 22 houses in various stages of completion that will be auctioned individually. Another referral has eight properties. The third is The Mark with 36 loft condominiums at Woodland Avenue and East High Street.

So the actual number of individual properties being foreclosed is twice, maybe even three times the number of court referrals, he said. Starting in 2009, Frazier plans to track the total number of properties contained within each court-ordered referral, reports the newspaper.

Bidders who come to sales include real estate agents, renovators and the banks that took back the property through foreclosure.

Banks typically want to unload the property, but only if they can recoup costs they have incurred, reports the Lexington Herald-Leader.

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