Los Angeles to penalize banks for neglecting foreclosed homes

17:13, May 22, 2010      

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The Los Angeles City Council on Friday approved an ordinance to penalize banks and other lenders for neglecting foreclosed homes.

Under the ordinance, banks or other lenders will pay a fine of 1,000 dollars each day if a foreclosed home becomes a blight on a neighborhood.

The city council sets the maximum annual fine at 100,000 dollars for each neglected home.

Banks will have 30 days to correct the problem before being penalized.

The ordinance also obliges the city to create a registry of foreclosed properties, whose owners will be told about requirements for keeping the property "clean and free from accumulation of debris, rubbish, garbage, trash, overgrown vegetation and other similar material.""

The Foreclosure Registry Program will serve as "a mechanism to protect residential neighborhoods from becoming blighted through the lack of adequate maintenance and security of abandoned properties as a result of the foreclosure crisis," city attorney Carmen Trutanich said.

City Council President Eric Garcetti said, "This ordinance is about keeping banks from seizing homes and then neglecting them to the point where they become magnets for trash, vermin and crime."

"To make sure banks get the message, this ordinance contains fines of up to 100,000 dollars," he said.

Garcetti said criminals sometimes move into foreclosed properties and use them for drug-dealing and other unlawful activities.

Neglected swimming pools can become breeding grounds for mosquitoes and are dangerous for children, while yards overgrown with brush can pose a fire hazard, Garcetti added.

Tens of thousands of homes have been foreclosed in the Los Angeles area amid a worsening financial crisis over the past two years.

Source: Xinhua


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