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Frustration in Dealing with Foreclosed Properties

February 11th, 2010 Leave a comment Go to comments

I’m recently back from the Region III conference in Brooklyn Park, MN put on by AMBO.  This year I stayed an extra night courtesy of Mother Nature (my Southwest flight was cancelled due to the snow storm in Chicago) but it gave me a chance to visit with a great group of people.  One of the things that really impressed me is the difference between laws in a state like Minnesota versus those in my home state, Illinois.  Inspectors in Minnesota have more tools at their disposal in dealing with the foreclosure crisis because of their ability to clean a property up and collect the costs on the property’s tax bill.  In theory, Illinois inspectors can do the same thing but the way the 2005 law is written makes it so convoluted that I don’t know anyone who has been successful in collecting any money this way.  Putting a lien on property isn’t sufficient.  Years may pass before the property sells or the lien may be wiped out by foreclosure proceedings depending on local law.  What is the difference between states?  I believe Illinois is in the grip of special interests that defeat bills that would make it easier to get property cleaned up and help local jurisdictions recoup their costs.  Being able to collect municipal expenses on next year’s tax bill for a problem property with a process that is simple and direct is a terrific tool that I wish I could use in my practice. It would eliminate the helplessness inspectors experience during the gap period, from the time the homeowner walks away from a property and the time the lender takes title.   I envy my Minnesota colleagues.

  1. John Caywood
    February 16th, 2010 at 06:39 | #1

    Linda,
    I invite you to contact me at City of Fort Wayne, Neighborhood Code Enforcement. I was part of the team which authored new ordinance which took effect 7/1/09. We now use administrative hearings where civil penalties are attached as a special tax assessment. This has received the attention of financial institutions. We have actually had bank reps appear when we bring foreclosed properties to hearings. Some banks have even hired contractors to make repairs rather than face penalties. I would be happy to share what the City has done with the new legislation.

  2. February 17th, 2010 at 15:35 | #2

    Linda, Thanks for teaching our courses. I got alot out of it. The books and CD will be useful. The second day did not qualify for Minnesota credits. May I send the course outline to the State to appeal their decision? Please advise.

  3. February 17th, 2010 at 20:37 | #3

    @Paul Hughes
    I would check with AMBO or ICC since I thought they handle the credits. It’s worth pursuing.
    Linda

  4. February 17th, 2010 at 20:39 | #4

    @John Caywood
    I only wish the politicians in Illinois could withstand the heavy lobbying of the lending institutions to allow us to do this too. An ordinance wouldn’t work. We’d need a change in state law. I envy your ability to do this. It’s terrific. In order to collect fines in our state from administrative hearings, we have to file a collection lawsuit which is often more costly than the fines owed.
    Linda

  5. John Caywood
    February 19th, 2010 at 13:16 | #5

    I’ve heard it called,”piercing the corporate veil.” It sounds like it’s made of kevlar in IL.

  6. March 1st, 2010 at 14:14 | #6

    @John Caywood
    John, could you send me the information polease? I am in charge of our Code Enforcement Division and like others collecting money in Illinois is a never ending proposition. If you folks found a way, I would love to read your ordinance. cgunty@bolingbrook.com

    Thanks

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