New zombie law to banks: take control of foreclosed property or give it up – WIVB.com – News 4

BUFFALO, N.Y. (WIVB)New York municipalities were handed a new tool, this week, to try to put the brakes on zombie properties. A new state law, banks are required to take control of properties they have foreclosed, or give up their financial stake in the property altogether.

Housing officialsgenerally blame certain bank foreclosure practices for creating zombie homes.The bank, or loan servicer, forecloses on a property, the homeowners move out, butthe bank often fails to follow through on the foreclosure, and the property isabandoned.

But Jordan Zeranti, anattorney for the Western New York Law Center, points out, the original homeownerstill has title to the property, but is long gone.

Formerhomeowners who thought that the property is no longer theirs, turns out, oncethe bank discharges the mortgage, the property is still theirs, however manyyears later.

This week, Gov. AndrewCuomo signed the Zombie Property Remediation Act of 2019, which Zeranti saidempowers cities, towns, villages, and counties to force a bank to eithercomplete a foreclosure on an abandoned property, or dismiss the mortgage.

They can compel the banksto bring a foreclosure action. That is something they were not able to dobefore. So it is huge.

But the municipalitiesbear the burden of determining when the property is abandoned, and Erie CountyClerk Michael Kearns has assembled a task force, the Zombies Initiative, tohelp local officials locate those vacant properties and write them up.

Anyone knows, you notonly buy the house, you buy the neighborhood, said Kearns, all peoplethemunicipalities, the banks, and really the homeownersthey are looking forsolutions.

Banks that fail to complywith the states zombie laws can be fined up to $500 a day. In any case, Kearnsurges homeowners who are faced with foreclosure to stay in their home,becauseas he points outthe banks often fail to follow through.

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New zombie law to banks: take control of foreclosed property or give it up - WIVB.com - News 4

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