Buffalo-based First Niagara Bank NA and Anaheim, Calif.-based Carrington Mortgage Services LLC last week adopted a set of best practices pushed by New York state to combat the neighborhood blight and economic damage caused by vacant and abandoned “zombie properties.”
Under the set of practices, banks and mortgage companies regularly inspect properties that fall into delinquency to determine if they are vacant and abandoned, and make sure they are maintained. Banks and mortgage companies report vacant and abandoned properties to a state registry developed by the state Department of Financial Services. With First Niagara and Carrington Mortgage’s agreement, a total of 13 banks, credit unions and mortgage companies representing roughly 70 percent of the New York market have now agreed to adopt the practices.
“Ensuring abandoned properties do not fall into disrepair not only protects neighborhoods from blight, but also shields homeowners from having to contend with the falling property values, public safety issues and increased taxpayer costs associated with having these zombie properties in their community,” Gov. Andrew Cuomo said in a statement.
Under current laws, property owners are responsible for their property’s upkeep, and banks and mortgage companies are not required to maintain abandoned properties until they receive a judgment of foreclosure. In a press release, Cuomo cited blight and safety hazards and taxpayer expenses in local communities as the major issues with zombie properties.
