Safeguard Properties

Senator Seeks to Permanently Extend Foreclosure Protection for Servicemembers

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On May 5, DS News released an article discussing U.S. Senator Sheldon Whitehouse’s (D-Rhode Island) announcement of a bill that aims to permanently extend benefits provided by the Foreclosure Relief and Extension for Servicemembers Act.

Senator Seeks to Permanently Extend Foreclosure Protection for Servicemembers

U.S. Senator Sheldon Whitehouse (D-Rhode Island) has announced legislation that would permanently protect servicemembers and their families from losing their homes to foreclosure, according to a release on Whitehouse’s website.

Whitehouse announced the legislation at the 8th Annual Veterans Breakfast and Resource Fair at the Rhode Island National Guard Armory. Attendees at the breakfast included representatives from federal and state agencies, employers, and veteran service organizations to assist veterans with information, employment opportunities, and other services.

“I look forward to this breakfast every year,” Whitehouse said. “It’s an opportunity to talk with Rhode Island veterans and their families about the issues they face, and provide an update on my work to ensure that veterans get the benefits, care, and fair treatment they’ve earned. This year I was also proud to announce the introduction of the Foreclosure Relief and Extension for Servicemembers Act. After fighting for our country overseas, our troops shouldn’t have to fight to keep a roof over their heads when they return home, and this bill will help.”

The bill, which Whitehouse introduced into the Senate on Thursday, April 30, would permanently extend foreclosure relief to servicemenbers provided by the Foreclosure Relief and Extension for Servicemembers Act of 2014, introduced by Whitehouse last May and signed into law by President Obama in December after unanimously passing in both the House and the Senate.

Whitehouse has fought for years to protect the rights of servicemembers who are homeowners. Last year’s bill extended until January 1, 2016, a provision that sets one year as the time a servicemember’s house is protected from foreclosure upon his or her return from active duty, if the mortgage was obtained before the servicemember was an active member of the military. The Commission on the National Guard and Reserves had submitted a report that prompted the foreclosure protection extension from 90 days to nine months in 2008. The period was extended to nine months as part of the Servicemembers’ Civil Relief Act (SCRA) in 2008 and lengthened further to one year in 2012 as part of a bill introduced by Whitehouse.

But while last year’s bill extended the foreclosure protections until January 1, 2016, the bill introduced by Whitehouse last week would permanently extend those protections.

“Servicemembers coming back from active duty often need time to regain their financial footing, particularly those in the National Guard and Reserves who give up their full-time jobs to fight for our freedom,” Whitehouse said. “To honor their service and grant them peace of mind, we need to provide sensible, permanent foreclosure protection for our veterans.”

Please click here to view the article online.

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

Nevada Considers Ending Foreclosure Mediation Program

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On May 8, National Mortgage Professional Magazine published an article discussing the decision of a Nevada legislative subcommittee to recommend the closure of the state’s Foreclosure Mediation Program.

Nevada Considers Ending Foreclosure Mediation Program

Members of a Nevada legislative subcommittee have voted to recommend the closure of the state’s Foreclosure Mediation Program, stating that program is no longer required due to the recovering state of local housing.

According to a Las Vegas Review-Journal report, the program was created by the legislature in 2009 to confront Nevada’s deteriorating housing market following the housing market crash. The program, which was overseen by the Nevada Supreme Court, reached a peak of 7,558 modifications in the 2011 fiscal year, with 40 percent of program participants retaining their homes. The program was financed through fees, including a $45 fee for filings of notices of default and a $400 mediation service fee attached to each assessed case.

With projected modifications at a low of 662 by 2017 and a $3 million annual budget, subcommittee members felt it was time for the state to step back from this issue.

“We’ve turned the corner on this one, and it’s time to move away from here and do something better with our money,” said Assemblyman Randy Kirner (R-Reno), who joined the Republican majority in recommending the program’s closure.

But Democrats on the panel opposed the decision, with Assemblywoman Heidi Swank (D-Las Vegas), noting that 282,000 homes in Nevada still had underwater mortgages.

“We are not out of the woods yet,” Swank said, recommending that the program remain for another two years before being reviewed again for possible shutdown.

Please click here to view the article online.

Please click here to view Foreclosure Mediation Program Rules online.

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

HUD: Foreclosure Crisis Response with the Neighborhood Stabilization Program

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A recent article published by the U.S. Department of Housing and Urban Development’s (HUD) online magazine, Edge, discussed a report released by HUD’s Office of Policy Development and Research (PD&R) concerning the Neighborhood Stabilization Program (NSP).

Foreclosure Crisis Response with the Neighborhood Stabilization Program

Congress created the Neighborhood Stabilization Program (NSP) in 2008 to counteract the negative consequences of the foreclosure crisis brought about by the housing market collapse. Administered by HUD and funded at $6.9 billion, NSP was implemented in three phases between 2008 and 2010. The second round of the program, NSP2, differed from the first round in that it instituted a competitive grant process and expanded eligibility for grants to nonprofit organizations in addition to state and local governments. In addition, NSP2 required grantees to determine target areas for concentrating funds based on HUD foreclosure distress risk scores. Eligible activities included financing, acquisition and rehabilitation, land banking, demolition, and redevelopment. In total, NSP2 directed $1.93 billion to 56 grantees in 133 counties and 29 states, covering 3,068 census tracts.

The overall goals of NSP were to slow the decline in home prices caused by foreclosures and reverse the negative spillover effects on surrounding neighborhoods. Researchers call this negative spillover a “contagion effect,” after the potential of foreclosures to spread throughout the neighborhood. Although research indicates that prices decline for properties surrounding a foreclosure, no consensus exists on the broader effects of foreclosures on other housing outcomes, such as vacancies, sales volume, financial distress, and whether homes are owner- or renter-occupied. Researchers are still debating the answers to some basic questions: How nearby does a foreclosure have to be for a negative effect to appear? How many foreclosed properties on a block are necessary to trigger a contagion effect? NSP2 provided an important opportunity to explore how concentrated investments can stabilize neighborhoods with high foreclosure rates.

Evaluation of the Neighborhood Stabilization Program

In February 2011, HUD commissioned research to evaluate the effects of NSP2. The resulting analysis covers NSP2’s three-year implementation, ending in February 2013, when all grant funds had to be spent. The study was to document how NSP2 grantees structured their programs, including how funds were invested in eligible activities, and to assess whether neighborhoods receiving NSP2 resources experienced positive benefits, such as rising home prices compared with census tracts not receiving NSP2 resources. In addition, the study investigated crime rates in financially distressed neighborhoods receiving NSP2 funding, and noted whether foreclosed properties showed signs of distress identifiable from the street.

Although the evaluation reports on all 56 grantees, the study focuses on 19 counties and 28 lead grantees based in various housing markets with significant levels of NSP activity. The research team used several quantitative and qualitative methods to investigate the program’s impact on the 6,354 properties receiving funding in the sample counties, including analysis of transaction records for millions of property foreclosures and sales in neighborhoods with and without NSP2 investments, interviews from two rounds of site visits with program grantees and partner organizations, and a Visual Tracking Survey of the exterior conditions of financially distressed and non-distressed properties that was performed three times over the course of a year. Due to limited resources, researchers conducted the Visual Tracking Survey only in Cuyahoga County, Ohio, and Palm Beach County, Florida.

Findings

Grantees varied in how they designed and implemented NSP2 across housing markets. Although this finding is not surprising given the considerable latitude that grantees had in designing their programs, these differing approaches to combating the foreclosure crisis were also influenced by local geography and economic performance in both the market boom of the 2000s and the recession later in the decade. Among the grantees in the study sample, acquisition and rehabilitation was the most common activity, accounting for 50 percent of all expenditures across the 19 counties. This activity was used most in Boom-Bust Sand States and Slow Growth markets, where it accounted for 50 percent and 85 percent of total program activity, respectively. Demolition, on the other hand, made up only 2 percent of total spending across the sample study, but was disproportionately focused on properties in the Lagging/Declining markets such as Cuyahoga County, Ohio (Cleveland) and Wayne County, Michigan (Detroit). In these markets, 77 percent of properties with NSP2 investments were demolished.

The grantees’ approach to implementation also evolved over the course of the program as they adapted their initial strategies to changing circumstances. Grantees shifted their focus from acquiring single-family properties to acquiring multifamily properties, as well as reallocating funds from acquisition and rehabilitation activity to redevelopment. Researchers point out that these modifications were likely caused by the program’s tight spending deadlines, as well as by increased competition from investors for foreclosed properties. Despite the scale of activities, researchers found little evidence that NSP2 investments created positive spillover effects in neighborhoods.

  • NSP2 did not systematically improve housing market outcomes for properties and census tracts where the program operated, relative to similarly distressed neighborhoods that did not receive NSP2 investments. While there is evidence that neighborhoods with program activities in Los Angeles County, California and Maricopa County, Arizona did see housing prices rise for properties near foreclosures, there was no sign of a consistent, positive spillover effect on housing outcomes across all counties. Moreover, some neighborhoods with intensive amounts of NSP2 funding, such as Philadelphia, experienced lower prices and higher vacancy rates than did other neighborhoods receiving less NSP2 funding. Researchers believe this finding of modest effectiveness is likely because the scale of the intervention was too small to successfully combat the housing crisis. The average census tract in the study, for example, contained 58 properties in financial distress and a total of 1,715 housing units — but only 7 properties actually received NSP2 funding. The study also concludes that, despite the program’s insistence on concentration, activities never achieved a sufficient level of concentration; the average distance between NSP2 properties in a typical census tract was 0.5 miles. The study does confirm previous research in finding that home prices declined for properties within 500 feet of a foreclosure sale.
  • In three cities, researchers analyzed the relationship between foreclosure and crime rates within distance rings of 250 and 433 feet surrounding a foreclosed property. The researchers found that NSP2 did not lead to a significant reduction of property or violent crime rates in Chicago or Denver, but there is evidence that the program contributed to a meaningful decrease in property and violent crime in Cleveland. Researchers found that demolition and land banking were responsible for the decrease in property crime in Cleveland, whereas rehabilitation and redevelopment led to a decrease in violent crime. One possible explanation for the positive results in Cleveland is that grantees explicitly chose neighborhoods for targeted investments based on crime rates.
  • The Visual Tracking Survey in Cuyahoga County, Ohio and Palm Beach County, Florida revealed that properties in financial distress present more signs of damage, disrepair, and blight than do properties not in that condition. These counties differed in important ways, however. In Cuyahoga County, the degree of visual blight was comparable on blocks with both high and low levels of foreclosure, whereas in Palm Beach County, observation of visual blight was higher on blocks with more financially distressed properties. Site teams also observed an overall reduction in the amount of visual blight in Palm Beach County between March 2012 and March 2013, but detected little decline in Cuyahoga County. Researchers credit this difference to the Florida county entering economic recovery.

Implications

Although NSP2 had a smaller overall impact on housing market outcomes in foreclosure-affected neighborhoods than many had hoped, it is important to consider that areas targeted for intervention were already significantly distressed before the program was implemented. In addition, the study design presents some limitations. The analysis period, which coincided with the program’s end date of February 2013, may have been too short to make conclusive determinations about NSP2’s long-term effects. Only 4,612 of the 6,354 properties rehabilitated with NSP2 funds were completed at the end of the observation period, meaning that there may be a lag between when program investments are complete (that is, when the properties are fully rehabilitated) and when market outcomes are observed. Despite this inconclusiveness, the study finds that NSP2 activities have the potential to spur future neighborhood revitalization, as grantees viewed program funding as a complement to their long-term strategies. Further research should examine conditions and outcomes in a smaller subset of census tracts for lessons and effective combinations of activities to pursue in those neighborhoods.

Please click here to view the article online.

Please click here to view The Evaluation of the Neighborhood Stabilization Program [pdf].

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

Florida HB 779 Aims to Protect Renters From Swift Evictions

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Updated 6/12: On June 4, the Sun Sentinel released an article titled New law gives renters more protection.

Link to article

Link to FL HB 779 enrolled text

On April 27, the Palm Beach Post released an article titled Tenant protection bill weakened, but passes.

Tenant protection bill weakened, but passes

Florida legislation that aims to protect renters in foreclosed homes from swift evictions passed both chambers Friday, but in a watered down version from what consumer advocates had first proposed.

The bill, HB 779, requires new owners of a foreclosed home to give tenants 30 days to vacate the residence before being forcefully evicted.

The original bill, which was backed by the Florida Alliance for Consumer Protection and Jacksonville Area Legal Aid, would have more closely mirrored a federal act that expired Dec. 31. Consumer advocates had hoped to give tenants 90 days to remain in the home, or require the new home owner to honor the rental lease.

“We would have loved to have a lot more, but at least this gives tenants a specific time frame from which to work,” said Florida Alliance for Consumer Protection Director Alice Vickers earlier this month. “I appreciate the bankers meeting us halfway on a lot of these issues.”

Sen. Darren Soto, D-Kissimmee, who sponsored the Senate’s version of the bill, said Florida is one of just eight states that allows for immediate eviction of tenants in foreclosed homes when a new owner buys the property.

The federal act was approved as the housing crisis escalated and renters were increasingly surprised by evictions, unaware that the homes they were living in were in foreclosure and had been repossessed.

Please click here to view the article online.

Please click here to view the full proposed text of FL HB 779 [pdf].

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

Bill Aims to Target Blighted Property Problem in Maine Cities

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Updated 7/21: On June 30, ME LD 1203/SP 430 was enacted by the Senate after a vote to override a veto by Governor Paul LePage.

Link to final bill/public law text [pdf]


Updated 6/11: On May 19, the Maine Sun Journal released an article titled Bill aimed at helping cities fight blight hits roadblock.

Link to article

On April 24, the Maine Sun Journal published an article discussing LD 1203/SP 430, a bill designed to aid municipal government deal with abandoned and blighted properties more quickly.

Bill aims to target blighted property problem in Maine cities
 
AUGUSTA —  A bill meant to help municipal government in Maine more quickly deal with abandoned and blighted properties is picking up solid support in the Legislature.

The measure, LD 1203, sponsored by state Sen. Nate Libby, D-Lewiston, is scheduled for a work session and possible vote before the Legislature’s Judiciary Committee on Monday, April 27.

“Because of abandoned properties in my hometown, we are faced with blight, public safety hazards, theft, vandalism, and demolition costs at the taxpayers’ expense,” Libby said in a prepared statement. “Of course, these problems are not unique to my community. The inability to transition abandoned properties back into the hands of redevelopers hamstrings a municipality’s ability to deal with the detrimental effects of abandoned property.”

Libby said that over the past four years, taxpayers in Lewiston have spent close to $1.5 million demolishing 58 derelict buildings left vacant by their former owners and the financial institutions holding the mortgages.

Under Libby’s bill, banks would be required to notify a municipality when they enter foreclosure proceedings on a property. The measure also requires banks to name an in-state representative that is responsible for the care, maintenance and security of the property in question.

The bill would allow municipalities to adopt standards for the care and maintenance of abandoned property and to hold property owners responsible for that care or they would face a local fine.

According to Libby, once a property has been abandoned, the condemnation process can last 18 to 24 months.

Libby said the dilapidation of abandoned properties almost always follows the same sequence of events, including seeing the building’s pipes freeze; vandals then stripping the boiler and the electrical systems of copper; and then water leaks lead to roof, foundation, and mold damage.

“There are several local developers with a track record of returning older, dilapidated buildings back into service, but they are unwilling to navigate a maze of uncertainty when the mortgage holder is unresponsive and based out of state,” said Libby, who also serves as a Lewiston City Councilor. “This inaction leads to properties sitting vacant, unsecured and uncared for unless the city voluntarily assumes some responsibility for their care at no small cost.”

A number of local officials including Lewiston’s city manager, Bangor’s city solicitor, representatives from the Maine Municipal Association and the Mayors Coalition all spoke in favor of the measure. City managers from Waterville, Augusta and Biddeford provided written support for the bill.

Please click here to view the article online.

Please click here for additional media coverage (Bangor Daily News Maine 4/25).

Please click here to view the full proposed text of LD 1203/SP 430 [pdf].

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

‘Zombie Home’ Amendment Scares Indy Officials

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Updated 5/14: A recently published article by WTTV CBS 4Indy discussed Indiana SB 415, which was signed by Governor Mike Pence on May 6.

Link to Article

On April 17, the Indianapolis Star released an article discussing Indiana SB 415, which is currently under consideration in the Indiana State Legislature.

‘Zombie home’ amendment scares Indy officials

A measure moving through the Indiana General Assembly was billed as an effort to give cities more tools to fight blight and crack down on abandoned homes that destabilize neighborhoods.

But one of the bill’s former sponsors said a recent amendment would do the exact opposite.

At issue are so-called “zombie homes” — properties stuck in a sort of limbo where the owners have abandoned their home amid a foreclosure, but continue to own the title for years with no one taking care of it.

In the wake of the housing crisis, state and local governments around the country have created foreclosure registries that force banks to maintain them in the meantime. Such mechanisms haven’t made their way to Indiana yet — but some local officials fear that an amendment approved by the House Local Government Committee would pre-empt cities from trying.

“We think that they’re trying to prevent a registry,” said City-County Councilman Jeff Miller, a Republican from Indianapolis. “What we need is to be able to say ‘go fix the grass, go mow the lawn.’ “

Unlike their undead namesake, the problem of zombie homes is very real.

According to RealtyTrac, a housing data analyst, zombie foreclosures are down 6 percent from last year, but still represent 25 percent of all active foreclosures. Indiana had 5,217 zombie homes at the end of January — the seventh most in the country.

“When they’re stuck in the foreclosure process, there’s not really a clear person who’s responsible for it,” said Rep. Justin Moed, D-Indianapolis, one of the bill’s original co-sponsors. “They kind of just sit there. Neighbors, community groups and cities don’t know what to do.”

Abandoned, unkempt properties can drive down home values and become a magnet for crime.

When contacted about the amendment by The Indianapolis Star, the sponsor of Senate Bill 415, state Sen. Jim Merritt, R-Indianapolis, said he never intended to block cities from cracking down on zombie properties, and promised to address the concerns.

The measure already passed the Senate unanimously without the zombie language. But rather than send the bill to conference committee, Merritt plans to agree to the House changes, which include an amendment protecting mortgage settlement conferences. He said it would be easier to add the clarifying language in another bank-related bill this session.

“We will find a bill to establish in the law to make sure that the city of Indianapolis can have a zombie registry if that’s what they desire,” Merritt said — a promise that has reassured Councilman Miller, at least.

Moed said he would wait to see the language to comment on the proposed fix. He and Rep. Dan Forestal, D-Indianapolis, withdrew their support for the bill when the amendment went through.

“For me, it’s a tough pill to swallow to tell cities and communities that we’re going to protect the banks from cities holding them responsible for these properties,” Moed said. “That’s a big policy change.”

Meanwhile, city officials said they hadn’t planned to pick a fight over zombie properties this year. Their priority for this session was making sure that the main thrust of SB 415 went into law. It would close a loophole that prevented Indianapolis from using certain anti-blight measures, and enact additional reforms to a convoluted tax sale system that’s riddled with red tape.

“There are certainly foreclosure issues that still hurt our neighborhoods, but it’s not the volume that we saw four or five years ago,” said Jeff Roeder, deputy director of the Indianapolis Department of Metropolitan Development.

In other states, banks have pushed back against zombie registries, questioning why they should have to maintain properties they don’t technically own. Chicago’s rules were particularly aggressive, requiring maintenance levels above and beyond a typical landowner’s responsibilities. They were later watered down in response to bank complaints.

Miller said he understands the concerns, but insists they could be addressed in a way that doesn’t totally handcuff the city.

“If that’s your concern, tell us what you don’t want us to do,” Miller said. “Use a scalpel instead of a bazooka.”

Please click here to view the article online.

Please click here to view more information on Indiana SB 415.

Please click here to view House Amendment #2 [pdf].

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

Oswego Adopts Ordinance to Maintain Foreclosed Properties

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On March 25, the Chicago Tribune (Aurora Beacon-News) released an article discussing an ordinance adopted by Oswego, Illinois that protects taxpayers from foreclosed property maintenance bills.

Oswego adopts ordinance to maintain foreclosed properties

Oswego trustees have adopted an ordinance to create a special kind of lien so taxpayers are not left with the bill to maintain foreclosed properties.

The state of Illinois adopted a law in 2010 that authorizes municipalities to record a “priority lien” to ensure priority payment for costs associated with maintaining a property at the time of a foreclosure sale.

Village officials said municipal liens on properties often are trumped by other liens, leaving little or nothing left for local governments to do to recover costs for securing windows and doors, weed removal or lawn mowing.

The average maintenance cost to the village has ranged from $250 to $2,500 per property, officials said.

“Generally there is no money remaining after paying off the loan so the liens are wiped out by the foreclosure and the village can get nothing. With the priority liens the entire procedure is changed,” said Oswego Community Development Director Rod Zenner.

Zenner said under the new procedures when someone buys a foreclosed property the money is used to pay off any outstanding taxes and the village is paid to recoup its expenses.

“The remaining money then goes toward the outstanding mortgage. That way we are guaranteed that the residents of the village will not bear the costs to maintain the property,” Zenner said.

Zenner said there has not been a “tremendous problem” with poorly maintained foreclosed properties in the village but the situation has happened.

“The real problem cases are the people that move out long before the bank takes over and they start providing maintenance. While there aren’t a lot of structures that we have trouble with we do look at each individual property,” Zenner said.

“That one house in the middle of a nice neighborhood is stressful to every resident in the neighborhood – especially the people that live next door. Anything that we can do to improve the situation is of great value to the neighbors,” he said.

Zenner said the majority of the foreclosed properties have been residential structures, although the village did have one commercial property to deal with last year.

Please click here to view the article online.

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

NC Senate Bill Targets Squatters Using Foreclosed Homes

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Legislation Update
April 26, 2016

A state Senate bill filed Tuesday would toughen penalties for people who take up residence in foreclosed homes and file fake legal documents to stay there.

Sen. Stan Bingham, a Davidson County Republican, said he’s proposing Senate Bill 754 in response to news reports about “sovereign citizens” who move in illegally and refuse to leave.

“Nuts, I call them,” Bingham said. “They’ll use the legal system to benefit themselves and move in properties.”

The Charlotte Observer wrote about such an incident last year. A group of people affiliated with a Moorish Nation group that doesn’t recognize state, federal or local laws moved into an $800,000 foreclosed home in the Piper Glen neighborhood.

The woman claiming ownership was evicted and arrested, but she kept coming back and filing nuisance legal claims against local police and the homeowner’s association.

“It’s a big problem in Mecklenburg County, I don’t know why,” Bingham said. “They’re going in these homes, eating nice food, running the refrigerator, running up the power bill.”

Bingham’s bill would make it a felony for someone to file false liens on property or occupy property they’d previously been evicted from. The penalty would include a fine of at least $1,000.

“This will give (authorities) a little leeway and prevent this thing from happening,” he said.

Source: The News & Observer

Additional Resource:
SB 754 (proposed text)

“Keep Chicago Renting” Ordinance Undergoes Changes to Close Loopholes

Posted on by Safeguard

On April 13, the Chicago Tribune published an article titled Aldermen make changes to Chicago foreclosure ordinance.

Aldermen make changes to Chicago foreclosure ordinance

A Chicago City Council committee took steps Monday to ensure a speedy turnaround for tenants who are living in foreclosed properties and are entitled to get a new lease or moving assistance under city code.

The housing committee recommended changes to the so-called Keep Chicago Renting ordinance, which requires that new owners of foreclosed rental properties offer new leases with a maximum 2 percent increase or pay $10,600 in moving assistance to each tenant.

Those changes would set a detailed timeline for the new property owners to offer either a new lease or moving assistance, and for tenants to respond to that offer. The entire process would take no longer than a few months.

Diane Limas, a volunteer with the Communities United group that was part of a coalition that pushed for the original ordinance, said her group’s research showed that up to 80 percent of new owners were exploiting “loopholes in the ordinance that have prevented the law from fully working as intended. … Oftentimes, new owners would cut off contact after sending renters the proper notice.”

The timeline requirements should keep that from happening in the future, Limas said. She was one of three housing advocates at Monday’s hearing to praise the proposed changes to the original ordinance, which was passed in 2013.

The changes also would ensure that a relative who was renting under a lease from the person who defaulted on the mortgage would be covered. And the changes would require new owners to either offer a similar rental unit or moving assistance to a renter whose unit was illegally converted to an apartment.

The city does not proactively enforce the ordinance, but it does take action if a tenant calls the city to file a complaint, said Steven McKenzie, a senior assistant corporation counsel for the city. The new owners most often are banks, but sometimes they are other companies or individuals, officials said.

The full City Council is expected to consider the changes Wednesday.

Please click here to view the article online.

Please click here to view Ordinance 02015-1485 (“Keep Chicago Renting”) text [pdf].

About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.

Housing Alliance Targeting Slow Recovery Areas for Loss Mitigation Outreach Events

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On April 27, DS News released an article discussing HOPE NOW’s plan to focus its outreach efforts on areas of the country that have been slow to recover from the Great Recession.

Housing Alliance Targeting Slow Recovery Areas for Loss Mitigation Outreach Events

Areas of the country that have been slow to recover from the recession will be the focus of HOPE NOW’s outreach efforts to offer loss mitigation options to struggling homeowners in 2015, according to an announcement from HOPE NOW.

HOPE NOW is an alliance between counselors, mortgage companies, investors, and other mortgage market participants, formed in 2007. The alliance’s outreach events put homeowners face to face with servicers and counselors to work out a loss mitigation solution and avoid foreclosure. These outreach events are also an opportunity to learn more about local housing task force efforts and state programs that offer assistance. The next HOPE NOW outreach event will be May 27 in Chicago.

“Our industry members comprehensively review all at-risk families for multiple options, when going through the loss mitigation process, and attempt to apply the most viable solution for each situation,” said Eric Selk, Executive Director of HOPE NOW. “Although the housing market has made a recovery on a national level, there are still pockets of the country experiencing a slower recovery and that has been the focus of HOPE NOW’s efforts in 2015.”

Selk said they have seen a great deal of repair in many of the markets HOPE NOW has visited in the past, such as San Bernardino in Southern California. A HOPE NOW outreach event in San Bernardino in 2010 brought out about 700 families; by comparison, an outreach event in San Bernardino in March 2015 drew only about 300.

“The reason for lower attendance is twofold – lower delinquency numbers across the board and more homeowners already in some stage of the loss mitigation process,” Selk said. “Despite the shifting dynamic of outreach events, our members are still committed to the face to face component as part of their overall outreach strategy.”

HOPE NOW is also planning an outreach event in June in St. Louis, though no date is set yet.

“There are plans to bring servicers together with non-profit partners in several other cities in 2015 as well,” Selk said. “HOPE NOW also continues to work with members on initiatives related to mortgage originations, abandoned properties and neighborhood stabilization.”

HOPE NOW reported 147,000 non-foreclosure solutions offered by the industry to struggling homeowners in February 2015, including permanent loan modifications, short sales, and deeds-in-lieu of foreclosure. February’s total of non-foreclosure solutions was more than five times the number of completed foreclosures for the month (28,000). Since HOPE NOW began reporting the data in 2007, the number of non-foreclosure solutions offered by the industry total approximately 23.5 million.

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About Safeguard 
Safeguard Properties is the mortgage field services industry leader, preserving vacant and foreclosed properties across the U.S., Puerto Rico, Virgin Islands and Guam. Founded in 1990 by Robert Klein and headquartered in Cleveland, Ohio, Safeguard provides the highest quality service to our clients by leveraging innovative technologies and proactively developing industry best practices and quality control procedures. Consistent with Safeguard’s values and mission, we are an active supporter of hundreds of charitable efforts across the country. Annually, Safeguard gives back to communities in partnership with our employees, vendors and clients. We also are dedicated to working with community leaders and officials to eliminate blight and stabilize neighborhoods. Safeguard is dedicated to preserving today and protecting tomorrow.  Website: www.safeguardproperties.com.