Once we let banks get away with not filing titles at the county clerk’s office, and instead privatize their mess with MERS, we gave away the best tool to hold the banks accountable.

Slowly, cities and counties are waking up to this. At a minimum, they are requiring banks to report properties they have seized and requiring them to keep them up and not simply let them fall into disrepair.

From PropertyWire:

Los Angeles is getting tough on the owners of foreclosed properties who leave them empty and let them fall into disrepair by increasing fines. In particular officials are cracking down on financial institutions such as banks and mortgage companies that seize properties and leave them to fall into a state of disrepair.

It is the city’s largest attempt to date to deal with a neglected 27,000 foreclosed properties that become an eyesore and also bring down the prices of neighbouring real estate.

‘It is right that the banks should be held accountable to cleaning them up. A lot of vacant homes have become a nuisance because of the foreclosure crisis,’ said Betty Steele, one of several community activists who is encouraging residents to report problem properties via the city’s 311 hotline.

ChicagoNow from back in May:

The Chicago City Council’s Buildings Committee was back in session today, this time taking up a pretty straightforward question: who is responsible for keeping people out of the thousands of vacant, bank-owned properties left in the wake of the foreclosure crisis? While the phrase “bank owned” seems like a pretty good clue to us, aldermen are still looking for ways to hold them accountable during the foreclosure process.

The latest idea comes courtesy of Northwest Side Alderman Dick Mell who is proposing that banks hire overnight guards to secure their properties. The measure passed out of committee today and will move to the full council for a vote next month.

But at a press conference unveiling the former proposal out in Albany Park yesterday, Mell let us in on to another sure-fire (and taxpayer free) way to get the banks attention: threaten to pull their city business.

It’s a strategy that city officials have used to cajole banks in the past. And that’s exactly what Mell did when U.S. Bank dragged its heels on rehabbing a prominent, vacant building in Mell’s own ward. When he took steps to pull them off the list of city repositories, “voila!” The building is now on its way back to life.

Likening the glut of vacant and foreclosed properties to “Chicago’s BP Amoco problem,” Mell said, “the banks and the lending institutions that caused this problem have to move faster.”

City officials have made it clear that boarding up foreclosed properties, which the Sun-Times reports cost taxpayers a cool $7 million last year, now tops their list of challenges. For a little perspective why, consider this: 3,700 vacant buildings are currently registered and another 11,000 to 12,000 vacant properties are expected to spring up this year, according to the buildings department. But as the Albany Park Neighborhood Council points out, only 24 properties are registered with the city, though there are hundreds around the community.

There’s more at both links.

Of course, if Treasury was as worried about keeping people living in these homes as they appear to be worried about keeping banksters in their country clubs, that would go a long ways toward reducing the number of foreclosures in the first place.

But it sure looks like municipalities aren’t holding their breath waiting for that to happen.

Thanks for highlighting this, EW. I’ve been saying this over and over, since I truly believe that housing, and all the ancillary businesses that provide goods and services to homeowners–from repairs to appliances–are the heart of our economy. If you don’t address housing, you can’t address unemployment or personal financial security. For years the U.S. tax policy has promoted homeownership as a form of social stability and wealth creation. While there are certainly places where housing prices were, and remain, obscenely high, the real problem today is that the mortgage market has dried up, even for people with good credit. Those hardest hit by a loss on property value are those of us in middle-market homes; high-priced homes are still selling for well above their purchase prices.

If we elect Dems to all branches of govt, then this stuff would never happen.

This is also caused by the fact that in today’s financial system greed is at an all time high as the motivating factor in business dealings. If I lend someone two thousand dollars at ten percent interest, I expect to gain two hundred dollars when we conclude our business. But some time ago, I don’t know when, they came up with the concept of the APR. Now if a person has his home financed he can expect to pay more than two times what the home is actually worth. We were sold the idea that someday we could sell an eighty thousand dollar home for two hundred thousand dollars. When a financial crisis like this happens; that is when you find out what a home is really worth. Although it would never happen, I believe that what a city could possibly do is to hold property lotteries. They could select several hundred properties in certain neighborhoods and actually give them away to middle income families that live in the city. This way they could benefit from the tax revenues and keep the properties from falling into disrepair. These families might never be able to go into a financing deal with a bank to actually buy a home and maintain the mortgages but if it were their home they could do a great job of maintaining the homes and they make enough money to meet the tax burdens. This would benefit everyone. The banks would be out but then again who really cares about banks. It is banks and other financial institutions that got us into this mess. They always do. Give them enough time and you will see that someday, again, it will be them that create the next financial crisis. There is a huge unbridgeable difference between the profit motive and pure unmitigated greed. It is they, not the average working Joes, that do all the damage to our economy. This has been the history of the corporate fat cats since the days of people like J.P. Morgan and the like. They couldn’t care less about the health and stability of our country. To them it is all about money. It’s an addiction like any other. It comes with a great deal of destructive side effects. Everything in life cannot and should not be about profit.

analogizes? I like it! It really is looking into the cause of the problem!

You go Marcy!

PS – I can’t get the nasty BP ad to move out of the way so that, when I click on the little green “send” icon, I can get to the window containing ways I could e-mail this article. BP ad blocks the window.

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I’ve lost about $100,000 off the pre-crash value of my house–which is a hell of a hit for an upper lower class, self-supporting, 67 year old single. The only thing that’s keeping me sort of right side up, but listing badly, is that I bought in 1977. Considering the actual value of money over that span, I haven’t made a dime, I may well have lost money. And Obama’s cat’s paw commission wants to slice and dice SS and Medicare? Sharron Angle’s second amendment remedies rise to mind.