Niagara Gazette

Local News

February 10, 2014

Dyster joins state attorney general for 'zombie house' discussion

New York Attorney General Eric Schneiderman has set his sights on the state’s “zombie houses.”

Schneiderman told a room of city officials that he will push legislation this session aimed at preventing houses left in limbo during lengthy foreclosure proceeding from becoming “zombie houses” — properties that fall into disrepair while lenders decide what they will do with the houses — during a morning session at the New York Conference of Mayors and Municipal Officials in Albany on Monday.

“We are looking to change state law so that lenders responsible for delinquent properties soon after they are abandoned, not at the end of a lengthy foreclosure process,” Schneiderman said in prepared remarks. “And we will make sure that a bank that enters into a foreclosure proceeding cannot simply walk away and leave a house to fall into ruin.”

Banks often stop foreclosure proceedings if it is determined that the value of the property – usually because it has been vandalized or fallen into extreme disrepair – is less than it would cost to complete a foreclosure process and sale. Often the mortgagee again assumes ownership without their knowledge, with any notices from the bank being mailed to the house that they had left.

Schneiderman’s bill would require lenders to maintain properties during foreclosure proceedings, a responsibility that now lies with the party being foreclosed upon until a judgement of foreclosure is granted.

The bill, which is “in development” according to an email from Schneiderman’s press office, would also create a state-wide registry for the “zombie properties.”

“There are thousands of these zombie properties plaguing communities all across this state and that’s just wrong,” Schneiderman said. “If a property is vacant and deteriorating a bank has a duty to maintain it and move swiftly to resolve the foreclosure case.”

Jessica Bacher, managing director at the Pace Land Use Law Center, has studied foreclosure issues in New York cities like Newburgh and Poughkeepsie where vacancy has become a large-scale problem.

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