Transcript Slide 1

Strategies to Deal with
Vacant and Foreclosed Properties
October 5, 2012
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Code Definition of a “Vacant Structure”
Building, Fire and Related Codes of Baltimore City:
116.4.1 Definition. “Vacant structure” means an unoccupied structure that is
unsafe or unfit for human habitation or other authorized use.
116.4.2 Determinations. A determination of vacancy and a determination of
noncompliance with a notice or order issued under this section may be based on
observation that a structure:
1) Is open to casual entry,
2) Has boarded windows or doors, or
3) Lacks intact window sashes, walls, or roof surfaces to repel weather entry.
Vacant structures are NOT merely unoccupied buildings or units. HUD’s
vacant unit account can be misleading.
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“Vacant Structure” Definition Applied
It only requires a
single board on
one window for a
property to be
designated as a
Vacant Structure
and therefore
“Unfit for Human
Habitation.”
Baltimore City Overview
• Population: 620,961
• Housing Units: 297,685
• Open violation Notices: 32,278
• Vacant Building Notices: 15,978
• Property Maintenance Inspectors: 87
• Inspections completed in FY’11: 252,320
• Work Orders Closed in FY ’11: 40,581
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Scope of the Blight
• Total of approximately 16,000 vacant properties.
• About 10,000 are concentrated in areas where there isn't
enough demand to rehabilitate and reoccupy vacants now or
in the near future.
Scope of the Blight
Vacants to Value Strategy:
 Cleaning, boarding, and demolition of blighted structures.
 Community Development Clusters: forming partnerships
with multiple non-profit and for-profit developers interested
in investing in these areas.
Scope of the Blight
• The remaining 6,000 vacants are located in areas where
the housing market can support revitalization.
Vacants to Value Strategy:
 Streamlined Code Enforcement
 Citations ($900)
 Injunctive Relief
 Receivership
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“Signs” of foreclosure
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4004 Parkwood – Foreclosure Filed March 16, 2010;
Photo taken June 23, 2010
Front and Rear of 2802 E. Fairmount Ave.
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Front of 2801 Virginia Ave.
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Who is responsible for foreclosed property?
Building, Fire and Related Codes of Baltimore City:
114.25 Responsibility of mortgagee. A person that acquires an interest in property
by way of a mortgage or deed of trust (“lender”) is liable to the same extent as an
owner/transferee for a violation or condemnation notice pertaining to a vacant unsafe
structure, if:
1) the person with primary responsibility fails to comply with the notice,
2) the lender has been notified by certified mail of the violation or condemnation
notice, and
3) within 180 days after the receipt of the notice:
a. ratification of a foreclosure sale of the property has not occurred, or
b. the lender has not released its mortgage or deed of trust.
114.25.3 During pendency of foreclosure. During the pendency of a foreclosure,
the lender is responsible for maintaining the property free from high vegetation and
from accumulation of trash and debris.
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Foreclosure Complications for Local Governments
• Foreclosure filing does not always
equal a sale (transfer).
 Some filings get resolved without the need to foreclose
 Need to watch out for the borrowers/lenders that have
walked away based on a filing.
• A sale (auction) does not equal the transfer of the
property.
• Identifying the parties involved.
• Getting in contact with a decision maker.
• Getting someone to take responsibility during the
foreclosure.
• Deed recordation.
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What to do in relation to vacant and abandoned foreclosures
• Unoccupied but not Vacant – Keep an eye on it.
 Issue violation notice at first signs of decline.
 Require a non-owner occupied property registration.
• Vacant property
 Locate responsible party
 Clean, Secure and Lien Property
 Keep them on a short leash
 Use Citation Authority
 Litigate if necessary - Injunction vs. Receivership
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What is a Receivership?
BUILDING, FIRE, AND RELATED CODES OF BALTIMORE CITY
SECTION 121 VACANT BUILDING RECEIVER
• A receivership action is a code enforcement tool that allows the City to
request the appointment of a vacant building receiver to abate the public
nuisance created by vacant and problem properties.
• All properties in receivership actions had been issued Vacant Building
Notices by Baltimore City. If an owner of the property fails to comply with
the notice, an attorney for Baltimore City’s housing department
can request the District Court to appoint a Receiver to sell, rehabilitate or
demolish the property.
• If a property is sold through a public auction or private sale, the Receiver
oversees the transfer to the new owner and reports the progress to the
District Court for approval.
• http://www.onehousebaltimore.org/what-is-a-receivership-action/
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How to Find a Responsible Party
Create a checklist:
 Property address
 Mail-to address
 Is the property registered?
 Has the owner pulled any permits?
 Do they own any other properties?
 Are any of these properties registered? If so, repeat analysis.
 Are the taxes paid?
 Are there additional names listed on the deed? If so, repeat
analysis.
 To what address was the last water bill mailed?
 Have they filed for bankruptcy?
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Identify In-House Resources
Data Sources:
 Land Records (Online?)
 Property Registration
 Licensing
 Permits
 Prior Code Actions
 Investigator Files
 Tax payments
 Water bills
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Free Online Resources
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Phone book, www.superpages.com
Google Search (Web sites), www.google.com
Pipl, www.pipl.com
Facebook, www.facebook.com, Myspace, www.myspace.com
SS Death Index, http://ssdi.rootsweb.ancestry.com , Obituary
FDIC (Banks), www.fdic.gov
MD Register of Wills, http://registers.maryland.gov
Case Search, http://casesearch.courts.state.md.us
SDAT, http://www.dat.state.md.us/
National Registered agent link, http://www.registeredagentinfo.com/
Federal Inmate search, http://www.bop.gov/iloc2/LocateInmate.jsp
State Inmate Search, http://www.dpscs.state.md.us/inmate
Short Sale Lender site, http://www.short-salespecialists.com/community_reports.shtml
• MERS, http://www.mersinc.org/
• MD Land Records, www.mdlandrec.net
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Mortgage Electronic Registration System (MERS)
www.mersinc.org
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Other Resources
• Knock on doors and ask neighbors
• Motor Vehicle Records.
• Fee Based Internet Services,
Accurint, CLEAR
• www.accurint.com
• www.west.thomson.com/westlaw
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Recap of Foreclosure Reform in Maryland
• 2008 Foreclosure Process Reform
• Expanded the foreclosure timeline and required notice to homeowners
• Tightened lending standards
• 2009 Additional Foreclosure Process Reform
• Facilitated local government intervention
• Expanded list of parties entitled to notice
• 2010 Mediation
• Instituted mediation, including judicial and OAH procedures, to ensure
meaningful loss mitigation evaluation along with a face to face meeting
• Established Maryland Housing Counseling Fund, capitalized by lender fees
at foreclosure filing stage ($300) and homeowner mediation opt-in fee ($50)
• 2011 Mediation Refined
• Increased time for borrowers to opt-in to mediation from 15 days to 25 days
• Provided for changes to forms through regulation
• Made certain changes relating to OAH (rules, timing)
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Maryland Foreclosure Task Force 2011
Governor O’Malley convened a Task Force in
the fall of 2011. The charge to the Task Force
was to:
1. Assess foreclosure trends and the impact of
foreclosures on communities across Maryland;
2. Identify further innovative and effective strategies to
enhance loss mitigation outcomes for homeowners;
and
3. Identify innovative and effective strategies to
strengthen Maryland neighborhoods impacted
by foreclosure.
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Maryland Foreclosure Task Force 2011
1. Create a centralized Foreclosed Property Registry
 https://www.dllr.state.md.us/ForeclosureRegistry/web/content/Home.aspx
2. Create a “fast track” liquidation of vacant properties.
3. Enact a Neighborhood Conservation Tax Credit
4. Expand financing tools and incentives for reclamation of foreclosed
properties
5. Encourage expanded partnerships between nonprofits, local
governments, REO holders and other Foreclosure Purchasers
6. Encourage transition of distressed properties, including multi-family
properties, to high quality affordable rental opportunities
7. Encourage the timely resale of distressed and REO properties to new
homeowners.
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Centralized Foreclosed Property Registry
Effective October 1, 2012
Within 30 days after a foreclosure sale of
residential property, a foreclosure purchaser shall submit an initial
registration to the foreclosed property registry.
The initial registration shall contain the following information:
1. The name, telephone number, and address of the foreclosure purchaser;
2. The street address of the property that is the subject of the foreclosure sale;
3. The date of the foreclosure sale;
4. Whether the property is a single–family or multifamily property;
5. The name and address of the person, including a substitute purchaser,
who can is authorized to accept legal service for the foreclosure purchaser;
6. To the best of the foreclosure purchaser’s knowledge at the time of registration:
a. Whether the residential property is vacant; and
b. The name, telephone number, and street address of the person who is
responsible for the maintenance of the property; and
7. Whether the foreclosure purchaser has possession of the property.
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Expedited Foreclosed Process for Vacant Property
Effective October 1, 2012
• At the request of the Foreclosure Purchaser, a county or municipality must
issue a certificate of vacancy if the local jurisdiction determines that the
property is vacant or unfit for human habitation.
• A county or municipal corporation may charge a fee of up to $100 and
establish procedures for the issuance of these certificates.
• If the certificate is valid at the time of filing an order to docket or complaint to
foreclose, the bill authorizes a secured party to expedite the foreclosure
process by skipping the requirement of a loss mitigation statement and
proceeding to an order to docket the foreclosure proceeding.
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Questions?
Peter Dolkart, Legislative Director, DHCD
[email protected]
410-514-7015
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