ART 1 OF 3: BAD-NEIGHBOR BANKS – A SUN SENTINEL INVESTIGATIO
Thousands of vacant homes across South Florida have deteriorated into eyesores that violate local health and safety laws, depress property values and spread blight. The owners of these homes: some of the world’s biggest banks.
In an extensive investigation of foreclosed homes plaguing our neighborhoods, the Sun Sentinel found more than 10,300 property code violations lodged against banks in 10 South Florida cities since 2007.
Municipalities cited the banks because they had title to the homes. But some banks deny responsibility for neglected houses for reasons that ordinary homeowners could not, the Sun Sentinel found.
Banks shift the blame, saying maintenance isn’t their job but the responsibility of another bank or company, known as a “loan servicer.” And they delay or evade accountability simply because they are faceless institutions, usually based in other states, even other countries.
The Sun Sentinel, in its investigation, identified banks as owners only in cases in which they held title to the property. But the newspaper also found that years after launching foreclosure suits, some banks or their agents balk at completing the process and taking title to homes that are unlikely to sell for much. That practice fuels a separate legal “limbo” problem that traps thousands of vacated homes in years-long court cases, often as they tumble into ruin.
In South Florida, property code violations are civil matters, dealt with mostly by fines, which when left uncorrected can compound daily and grow to be ludicrously steep — as much as $4.7 million, for example, on a rundown Fort Lauderdale house owned by Germany’s Deutsche Bank.
Ultimately, banks negotiate with local officials to dramatically cut the fines so as not to hinder a home’s sale.
The results of these practices are on stark display on street after street, where vacant properties sit decaying and forlorn.
They are eyesores. Many have been looted. Some have caught fire. They attract vagrants and vandals, lead to increased crime, and can depress the value of nearby homes, particularly if there is an abundance of them in a neighborhood.
Some vacant homes pose extreme danger.
In Miramar in October 2009, a common worry of parents came true. While his family was busy unpacking boxes and moving into the house next door, a toddler wandered into the backyard of an unoccupied, bank-owned house and drowned in the pool.