City of Los Angeles VPR Ordinance
May 26th, 2010
New LA ordinance will force lenders to maintain foreclosed homes
Banks and other lenders in Los Angeles will have to maintain foreclosed homes or face a $1,000-a-day fine under an ordinance approved Friday that is designed to stem neighborhood blight.
The City Council voted unanimously for the measure, which requires lenders to register foreclosed homes and keep the properties clean and free of "accumulation of debris, rubbish, garbage, trash, overgrown vegetation and other similar material."
"This is about protecting neighborhoods," council President Eric Garcetti said. "We want to stop blight from developing before it affects an entire neighborhood and all property values go down."
Garcetti said criminals sometimes move into foreclosed properties and use them for drug dealing and other unlawful activities. He added that neglected swimming pools can become breeding grounds for mosquitoes and are dangerous for children, while yards overgrown with brush can pose a fire hazard.
Lenders will be charged an annual registration fee of $155 per home. Failure to sign up will result in a fine of $250 a day.
And banks that fail to maintain foreclosed homes will be charged $1,000 per day, up to $100,000 a year. They will have 30 days to correct the problem before the financial penalties kick in.
I hope this will send a message to the banks that they should work to keep people in their homes," said Westside Councilman Bill Rosendahl, who asked for a breakdown of foreclosed properties and their owners.
Councilman Richard Alarcon said the success of the program will depend on the public's cooperation.
"This will not work unless the public lets us know where the problems are," Alarcon said. "We have properties where the weeds are overgrown, where pools are left unguarded and where kids can drown."
Representatives of the banking industry said the maintenance problems result because of the time-consuming foreclosure process and the difficulty in reselling the homes.
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About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees and a handful of contractors performing services in the Midwest, to a national company with over 700 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.