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Los Angeles officials propose tougher foreclosure registry

Economy, Business and FinanceForeclosuresLaws and Legislation
Audit says L.A. registry program has done little to prevent foreclosures from becoming blighted eyesores
Community groups say many foreclosed houses in L.A. have fallen into disrepair and harbor crime

Calling it well-intentioned but "flawed" and "ineffective," Los Angeles officials Tuesday unveiled a plan to streamline and toughen the city's 4-year-old foreclosure registry program.

A motion filed by City Councilman Gil Cedillo would boost fees to fund more inspection of some of the 4,000-plus bank-owned houses across Los Angeles. It would also streamline the program to make it easier for various arms of the city's bureaucracy to communicate about the registry so houses don't fall through the cracks.

"This ordinance is a tool that has been underutilized," Cedillo said. "This will allow for a proactive approach."

Cedillo's motion accompanied the release of a 40-page audit by City Controller Ron Galperin, which said the program has done little to prevent foreclosures from becoming blighted eyesores and to hold banks accountable for their condition. Galperin urged a menu of changes that would tweak the program to focus on the most-blighted bank-owned houses, and to fund better enforcement by building inspectors.

Like many cities in the wake of the mortgage crisis, Los Angeles created the registry in 2010 to better track thousands of foreclosed homes and ensure that banks took care of them after evicting their owners. But community groups say too many of those houses have fallen into disrepair, harbor crime and drag down the value of neighboring homes. They also say the toughest penalties the registry law allows — up to $1,000 per day — have never been levied.

Officials with the city's Division of Building and Safety have said they lack the resources to inspect foreclosures and can only respond to complaints.

A coalition of community groups has been pushing for tougher enforcement, and several activists said Cedillo's proposal would at least be a step in the right direction.

"It's certainly not everything we want," said Bill Przylucki of People Organized for Westside Renewal. "But this is how progress gets made."

For Angelina Jimenez, a useful registry would have been a big help. She has spent the last two years watching and cleaning up around a vacant foreclosure on her block in the Exposition Park neighborhood of South L.A. She says she even parked her car in the home's driveway to make it look occupied.

"I didn't want it to seem like an abandoned house," Jimenez said.

She urged real estate agents who stopped by to tell the bank to take care of the house, to no avail. Under the proposals by Cedillo and Galperin, the house would get a quick once-over when the bank took possession, and if it was found to be in rough shape, it would be referred for more aggressive inspection and enforcement.

The goal, Galperin said, is not to punish banks but to encourage them to take better care of their property, so neighbors don't have to.

"This is not about fining everybody for what they're doing wrong," he said. "It's about encouraging them to do what they're supposed to do."

tim.logan@latimes.com

Twitter: @bytimlogan

Copyright © 2014, Los Angeles Times
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