The City of Kingston is looking for another lawyer. It is seeking “a qualified legal consultant to provide outside counsel on the City’s current in rem foreclosure process.” The service will help the city’s office of housing initiatives, the building and safety division, and the corporation counsel to devise legal strategies to deal with properties that have languished in foreclosure.
Often vacant or abandoned, these zombie properties are seen as a blight to communities and a barrier to achieving equity in housing supply.
“With an extreme shortage of housing stock,” mayor Steve Noble has said, “it’s unconscionable for homes to be sitting vacant, deteriorating, when so many are in need.”
Kingston director of housing initiatives Bartek Starodaj estimates that there are between 200 and 300 vacant homes in the city. Fewer than half are in foreclosure. It’s been a time-consuming task to identify problem properties, research the titles, and establish the stage of foreclosure the properties are in.
State legislation known as the “Zombie Property Remediation Act of 2019” was released into the legal wilds specifically to address abandoned and vacant properties. Zombie properties are rarely maintained while they are frozen in prolonged court proceedings.
The law basically compels mortgage lenders to assume maintenance obligations over one-to-four-family residential properties within 90 days of when their mortgage loans fall into delinquency. Such properties are not just investment vehicles for the lenders. Since they are their actual properties, lenders need to act like homeowners in good standing.
On January 6, 2019 state attorney general Letitia James announced the expansion of the grant initiative, now known as Zombie 2.0, to address the growing statewide issue. Out of that nine-million-dollar grant program, the City of Kingston received $128,250 to help improve its housing-code enforcement, to track and monitor vacant properties, and to bolster its capacity for legal enforcement.
Banks and mortgage companies will need to comply with local and state law.
“These abandoned houses significantly decrease property values,” said James, “and threaten the safety of surrounding neighborhoods.”
These grants are a continuation of the 2016 Zombie Remediation and Prevention Initiative created by the New York attorney general’s office, which has provided nearly $13 million in grants to 76 New York municipalities.
The national non-profit LISC (Local Initiatives Support Corporation) runs Zombie 2.0 with funds administered by the non-profit Enterprise Community Partners.
“Municipalities all over the state are reducing their number of vacant homes, energizing their local economies and improving their long-term quality of life,” says Helene Caloir, director of LISC’s New York Stabilization Fund. “One vacant house gets spruced up and soon there are prospective purchasers. Surrounding neighbors start investing more in their homes as nearby properties improve, and the entire community is lifted. House by house, block by block, neighborhoods are on the upswing.”
The legal consultant will assist lenders and mortgage servicers to bring properties into legal compliance, to expedite their foreclosures, and to pursue other initiatives to relieve the negative impacts of abandoned properties.
At least six city-owned properties have unknown or unresolved liens. Remediating the title issues will allow the city to transfer these properties to qualified buyers.
Proposals in response to the RFP (Request For Proposals) are due by March 8 at 2 p.m.
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