Wednesday, June 25, 2008

Peoria bolsters fight against foreclosures

Peoria AZ Foreclosures

Peoria bolsters fight against foreclosures

Peoria has stepped up its efforts to identify vacant foreclosed homes before they become blight on a neighborhood.

The city's utility staff and trash haulers are now taking note if they suspect an abandoned home, such as trash cans not placed at the curb. Police are then made aware of the vacant homes and keep an extra set of eyes on them.

"The county is plagued by foreclosures due to the financial crisis," City Manager Terry Ellis said. "It's a problem in our neighborhoods."
Staff last week gave the City Council an update on a newly formed foreclosure task force, charged with coming up with solutions to reduce the impact of abandoned homes in neighborhoods. Representatives from a number of city departments, including city attorney, police and community development, serve on the committee.

One in 33 homes on average are in foreclosure nationwide, said Glen Van Nimwegen, Peoria's director of community development. In Arizona, one in 18 homes are in some state of foreclosure and as of May, Peoria showed 1,397 homes in the process of being taken back by lenders, Van Nimwegen said.

Arizona and Florida showed the highest foreclosure numbers in the country - the two states were the fastest-growing, which prompted home values to peak and encouraged bad loans, he said.

Peoria currently employs a number of tactics to deal with foreclosed homes that are neglected and overgrown with weeds, becoming neighborhood eyesores.

The city can issue citations to homeowners and with the city manager's approval do immediate abatement at homes with imminent hazards, such as green pools and broken windows, said Van Nimwegen.

The city also uses volunteer groups to clean up an abandoned property after securing permission from the lender to access the site, Van Nimwegen said. He said lending institutions are starting to become more responsive to the problem.

Councilwoman Vicki Hunt at the end of last week's council meeting issued a plea to civic groups for such volunteers.

"We will get the permission for you if your group steps forward," she said.

The city also can go onto a property, do the necessary cleanup and then slap a lien on the home to recoup the costs, but only through the abatement process, Van Nimwegen said. That process requires a notice and appeals by the property owner, he added.

Councilman Ron Aames asked why, if a homeowner can't be located for permission to access the property, can't the city declare the site an immediate danger and abate it because overgrown weeds can become a fire hazard.

"My biggest concern is the front yard," Aames said. "You have just one of those homes and it brings down the entire neighborhood."

City Attorney Steve Kemp said the city has to show significant conditions with a property to take that route.

"Property owners have the right to control access to their property," Kemp said.

Also, he said, placing a lien on a property has limited success.

Oftentimes, the value of the loan far exceeds the value of the property and sometimes there are two and even three loans taken out on a property, meaning the city rarely collects the lien.

When a homeowner is in foreclosure, other bills are not paid and bankruptcy is pursued, discharging the homeowner's debt, including the lien, Kemp said.

"The city fronts all the abatement costs," he said. "The city doesn't recover a significant amount from the abatement of a property."

Kemp said it cost the city anywhere from a few thousand dollars to $30,000 in one extreme case for abatement.

Van Nimwegen suggested the city work within its current ordinances and advised expanding the Neighborhood Pride program and creating a central point of contact for other departments to report vacant homes.
Source: Cecilia Chan - The Arizona Republic

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