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Ordinance would punish banks for letting foreclosed homes fall into disrepair
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LAS VEGAS REVIEW-JOURNAL
Banks could be facing misdemeanor charges for letting foreclosed homes in Las Vegas fall into disrepair if a proposed city ordinance goes into effect.
Ward 6 Councilman Steve Ross is calling for the ordinance, saying the city needs to crack down on banks to reduce the number of blighted houses.
"You can drive through any neighborhood and just pick out the foreclosures. The grass is dead, the trees are dead, sometimes the windows are broken out, and the pools are green," said Ross, whose northwest ward is home to some of the highest foreclosure rates in the country.
"I'm not trying to be mean to the banks, I'm trying to get their attention to help us with this problem."
The ordinance calls for banks to register empty homes with the city for a $200 fee and makes it a misdemeanor for the houses to fall into disrepair.
It is scheduled to go before the City Council recommending committee today and could go before the council Wednesday or later in the month.
The Clark County Commission discussed a similar proposal Oct. 18 but didn't act on the measure.
The city registration would include the name and address of the "mortgagee" and a contact name and phone number for a property manager. It also calls for landscaping, pools, spas, doors, windows and gates to be properly maintained.
Penalties for violating the ordinance would be a fine of up to $1,000 or up to six months in jail for each day the home is out of compliance.
The proposal is likely to be popular with residents who have grown weary of looking at abandoned properties with tall weeds, broken windows and other problems.
"The whole point of this for me is to try and increase the quality of life for these neighborhoods," Ross said.
Currently all homes, those in foreclosure and those in good standing, are subject to residential landscaping and maintenance codes. When codes are violated, homeowners can be assessed. If the assessments aren't paid, then the city can hire companies to drain a foul pool or remove overgrown weeds with the cost passed along to the owner.
If the costs and penalties aren't paid, the city puts a lien on the house that must be paid or forgiven before someone else can buy it. The City Council regularly hears from would-be homeowners who find a house they like only to learn it has thousands, or tens of thousands, of dollars in liens against it because the previous owners didn't pay maintenance assessments.
Ross said the ordinance would reduce such instances because the registry would track empty, bank-owned properties and the stiffer penalties would compel banks to care for the houses.
But people in the real estate industry question whether the ordinance would work. For example, real estate broker Samantha Weitzel said, Assembly Bill 284, a state law that recently went into effect, could undermine the ordinance even before it is enacted.
The bill requires banks or other note holders to prove ownership of the property and ensure the county recorder has signed off on appropriate documentation before foreclosing or face penalties.
Weitzel said that means there may be more properties that are abandoned by borrowers but not officially under bank control, meaning the ordinance wouldn't do anything to spur better maintenance.
"The city probably thinks the banks own them, but the banks haven't foreclosed on them," Weirtzel said.
Weirtzel, who specializes in distressed properties, said much of the deterioration that occurs in a doomed property happens in the waning days of the borrower's time in the home and before the bank takes control.
During that time frame, maintenance is still the responsibility of the borrower.
"The banks are kind of handcuffed in what they can do or what they can't do to the property," she said.
Weitzel said banks tend to act swiftly to repair health and safety problems and clean unkempt yards once they take over the property. Many foreclosed homes are "not in the best condition, so that affects the market value," she said. "It is in the banks' interest to make sure it is in as good as condition as possible."
Realtor Don O'Neil said he doesn't think a registration requirement would do much to reduce blight. He said the city already has the ability to identify whether a house is empty and who owns it through existing records.
"All they are doing is making the banks pay another 200 bucks to list it on a list," O'Neil said. "All that information is public record."
Weitzel said it would be more effective for the city to work more closely with water and electricity utilities to track properties. That's because canceled utilities are one of the first signs a property has been abandoned.
If utilities were able to notify the city and banks that water or power had been shut off, it would be easier to intervene on maintenance before the property became a blight, she said.
"If it is 120 degrees outside and they don't have power on, then there is a good possibility they are moved out," she said. "(Banks) generally will secure properties they find to be vacant. They don't want anyone to damage the house."
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@GaryD;
Have you gone off your medication again??
Yes lets fine them a few hundred dollars for letting houses go in dis-repair, however, we continue to do nothing about the fact that they refuse to honestly deal with re-fi's and for people out and then foreclose in the first place.
In reply to doogie who wrote on October 31, 2011 08:10 PM:
"Funny, my neighbor moved out recently, and placed 2 ceiling fans and an expensive patio umbrella on his driveway. I knew it was a foreclosure abandonment, since he had paid over 300G for a house that cost 145G new in 2000. So I have a nice patio umbrella, and fans in my garage and kitchen due to his financial problems. Thank you. A nice lady subsequently bought the house later, and all is peachy in Henderson."
Really... so all is peachy? You essentially took something (read that stole) that did nto belong to you and used it for your own benefit. In the meantime, the neighbor next door who since she bought the house is the rightful owner of the fans and patio umbrella has to replace the stuff you stole.
The stuff was not uyours to claim and should be given back to your neighbor. Too bad you don't list your address or I'd let your neighbors know you stole their fans and umbrella.
GEEMAN1101: I really don't see how much money banks make on foreclosures because I own Bank of America stock and I have seen it tumble from 52.00 a few years ago to around 6.60 today.
That is about an 80 percent hair cut from what I see. Maybe you have a more educated view of things than I do. You should invest in them because of your "insider information". You definately know something I don't know or maybe you figure profit and loss differentLY than I do. PLEASE INFORM ME ON WHAT TO DO TO RECOVER MY MONEY!!!!!!!
I support this ordinance. Let's do it in Henderson also.My neighbor abandoned his house with a pool. I tried to keep the pool clean but then they shut off the power. Now no pool filter and no water for landscaping. I called the city and someone came out and drained the green pool. It is still a mess. I think the bank should provide to upkeep the property and maintain the pool or completely seal it. The house hasn't been listed since May. What a mess!
b.b.
do you realize how much Banks make on foreclosures?
This would be a great ordinance to keep our neighbor hoods looking nice, and would put many landscapers, and repairman to work.
I don't see a problem with the Bank's not being under control of the property yet, as this upkeep needs to be done directed by the city, and eventually paid for by the Lender.
It is not fair that neighbors have to live in these conditions.
In most cases it is just a matter of supplying power for irrigation, and maintaining water to the house.
this is completely fair. whoever owns the property, needs to keep it maintained. especially banks that get tax breaks on the property itself. they are not punished for holding it.
What would Ross do if the banks said that they can't make money here and completely stopped making house loans in the city? Councilman Ross,, You just created another "HOOP" for business to jump thru and guess what the cost of that "HOOP" will be carried by the borrowers. My opinion is "DUMB MOVE"
FACT #1 --- Fannie Mae + Freddie Mac are holding 70%+ of the mortgages in the U.S. today (thanks Obama) -- FACT #2 --- Fannie Mae + Freddie Mac are the Government -- FACT #3 --- The taxpayers are on the hook for Fannie Mae + Freddie Mac. ------------------------------------------------------------------------------------------------------------------------------------------------------- We the taxpayers are holding 70%+ of the mortgages in the U.S. - so let's "SUE OURSELVES" to repair and upgrade these foreclosed homes !!!! ------------- Better idea - Obama is the President and representative of the people, and in charge of all programs like Fannie Mae + Freddie Mac - so, "WHY NOT FINE OBAMA $1,000.00 AND GIVE HIM 6 MONTHS IN JAIL FOR EVERY FORECLOSED HOME THAT IS NOT IN COMPLIANCE ????"