Standing in front of a dilapidated Wantagh zombie home, Hempstead Town Supervisor Anthony J. Santino announced a proposal that would require banks and other home financiers that commence a foreclosure on a residential property to provide Hempstead Town with “security funding” to ensure the maintenance of vacant foreclosed properties. Joining Santino at the “neighborhood preservation” announcement were Councilman Gary Hudes, Councilwoman Erin King Sweeney and Councilman Anthony D’Esposito.
“It’s time for big banks and other financial institutions to ‘do the right thing’ when it comes to ensuring that properties which they have seized don’t become a blight on local neighborhoods,” said Santino. “It’s unacceptable for banks to make big profits on home mortgages and then turn their backs on neighbors by failing to maintain these same properties once they foreclose on them. That’s why I have come up with a plan that puts lenders ‘on the hook,’ ensuring that they put up ‘security funding’ to guarantee property upkeep of vacant homes.”
The Supervisor’s plan, which will be the subject of a public hearing at the May 24th Town Board meeting, would create a new section of the town code to deal with maintaining zombie homes that are the subject of foreclosures. Under the law, banks and other lenders that commence foreclosure proceedings on residential properties would be required to provide Hempstead Town with “security funding” in the amount of $25,000 (cash, cash bond, letter of credit) to secure the continued maintenance of the property in conformity with the Hempstead Town Code. In specific, the town could draw upon the monies to upkeep zombie homes in the event that the lender fails in its responsibility to maintain the home. The types of maintenance issues that fall under this legislation include lawn trimming, debris removal, securing of properties (boarding up windows, doors), placing safety covers on pools, removing graffiti, etc.
“This legislation is about preserving the quality of life in our neighborhoods,” stated King Sweeney. Added Hudes, “Supervisor Santino and I are fighting to make sure that banks are better neighbors when it comes to foreclosed properties.”
Santino said that his proposal is in the public interest and will help ensure better maintenance of foreclosed properties by lenders. He observed that the “security funding” that financiers are required to provide to the town under the proposal would create a financial disincentive to allow properties to fall into disrepair. The security monies would also help expedite remediation of violations such as overgrown grass and accumulated debris. Finally, the Supervisor’s proposal would help avoid the substantial outlays of public funds while still accommodating the upkeep of zombie houses.
“Supervisor Santino is standing up for homeowners, and he is taking on the profiteering ways of some banks who don’t care about our communities,” stated D’Esposito.
The Santino zombie home plan also has provisions that require lenders to replenish the “security fund” as monies are depleted to maintain foreclosed, vacant houses. Additionally, the plan provides for penalties of up to $1,500 per day for lenders who fail to provide the $25,000 “security fund” stipulated under the proposed law.
“I am standing with homeowners to protect our neighborhoods from the blight of zombie homes,” concluded Santino. “It’s time to demand that bad banks and other lenders put people ahead of profits. I will make sure that they become better neighbors.”