City to Hold Banks Responsible for Foreclosed Property

by July 15, 2011

In an effort to combat the problem of abandoned properties in Chicago neighborhoods, the City Council approved an ordinance that will hold lending institutions responsible for the upkeep of properties foreclosed upon.  The move comes as community groups have become increasingly vocal over the last few weeks because of an upsurge in crime during the summer months.

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Residents say the abandoned buildings create a crime haven for drug dealers, gang members and squatters.  The buildings also cost taxpayers.  As of last year the, city spent $15 million for general upkeep, demolition and board-ups of abandoned properties.  “All too often, communities are devastated by foreclosures as vacant properties fall into disrepair and the City takes on an unnecessary financial burden,” Mayor Rahm Emanuel said.  “This ordinance will help protect neighborhoods hit hard by these difficult economic times.  This issue affects every part of the city… but is concentrated in communities that need all the help they can get to stay afloat.”

Council members say they too have grown tired of fielding complaints from constituents about bank properties not being taken care of.  Several aldermen said the problem has gotten so out of control, due to the bad economy, they have had to assign a staff member full-time for just this one issue.  “I’ve had to call my ward superintendent several times to have him clean out yards and talk with my police commanders when we have squatters going in buildings.  This ordinance will work to ensure that entire communities are not left behind when individual properties are foreclosed upon,” said the alderman who introduced the ordinance, Pat Dowell.  “Banks will be responsible for keeping vacant properties from deteriorating while the foreclosure is in process, keeping them secure and keeping our neighborhoods intact.”

The issue of vacant buildings and squatters is a serious one. This past winter, two firefighters were killed and a dozen more injured as they battled a blaze on the South Side.  Investigators believe the fire was started by homeless people who were using the heat to keep warm on a cold winter night.  Vacant buildings also create other problems, according to Action Now, a community-based group that focuses on social issues in Chicago neighborhoods.  Marsha Godard, a representative for the group, worked with Dowell to address the foreclosure issue. A resident of North Lawndale, Godard said vacant buildings pull down the morale of the neighborhood, in addition to creating health problems.

“It’s an eyesore to the community to have grass as tall as me,” said Godard, who added there are four abandoned buildings on her block alone.  “It’s not a good feeling when I go home and I feel bad because in this neighborhood you can’t even let your kids go outside to play because you are fearful they can be pulled into one of the vacant properties and beaten, raped or killed.  And because of the economy, you can’t move anywhere, so you are stuck in this environment.”  

Godard said abandon buildings also become nests for rats, roaches, possums and she has even had a raccoon as a neighbor.  She said the wildlife creates health concerns for not just humans, but for pets as well.  On her block, neighbors have taken it upon themselves as a community to try to keep the abandoned properties clean.  But even that is difficult.  “The gang members come and just take over.  They drink and just throw their beer and wine bottles all over other people’s property so we are constantly cleaning.”

Currently, lenders and lien holders of vacant properties are responsible for maintenance only after they own a foreclosed property.  The ordinance amends the current municipal code. Owners will be required to implement routine maintenance on properties such as boarding entrances to a building; responding to complaints relating to the building; cutting grass and shoveling snow or face fines from the city.

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