The Town of Babylon has enacted legislation that it hopes will get the town out in front of the problem of abandoned dilapidated homes.
The town last month passed the Mortgage-in-Default Registry law, requiring banks and mortgage lenders to register with the town as soon as a home mortgage goes into default. This can happen as soon as one missed payment, town officials said. Not all of the homes will continue to be in default nor be abandoned, they said.
Town attorney Joseph Wilson said the town based the law on similar legislation enacted in cities such as Jacksonville, Florida, which passed its own version of a mortgage default registration ordinance last year. Wilson said he believes this is the only law of its kind on Long Island.
The effort is aimed at getting ahead of “zombie” homes, houses that have gone into foreclosure and been abandoned by their owners, often falling into disrepair during the state’s lengthy foreclosure process. A report last year by Newsday and News 12 Long Island found that Long Island led the state and ranked among the top 10 regions in the nation in the number of zombie houses.
“This is us getting out in front of it,” said Babylon Town Deputy Supervisor Tony Martinez. “Usually, the way we learn a house is abandoned is when neighbors start complaining and the complaints come in when the house is already deteriorating” with such problems as rodent infestations, broken windows and squatters.
The town estimates that it has at least 400 abandoned homes, 80 percent of which are already registered with the town through its own response to complaints. The new registry could potentially contain thousands of properties, town officials said.
The law requires mortgagees to inspect and register a property within 10 days of the parcel going into default and to continue to inspect the property monthly as long as it remains in default, even if the property is occupied by the owner. The law also lays out specific maintenance and security requirements for the properties.
Lenders also will have to report each time a mortgage changes hands and the new company will be responsible for registering as well. Penalties for violations start with a first-offense fine of $250 to $1,000 and up to 15 days in jail.
“We’re making banks aware . . . that this is going to be your responsibility to make sure that the property is maintained,” Martinez said. “We’re putting them on notice that they’re on the hook.”
Under the law, the lenders will have to pay an annual $200 registration fee per property to a company the town will hire to manage the registry. Town officials said there will be no cost to taxpayers, as the company is paid through the registration fees.
Earlier this year, Gov. Andrew M. Cuomo signed into law new requirements that mandate that banks and mortgage servicers report vacant properties to the state within 15 days of learning they are abandoned. Companies that fail to maintain vacant houses face fines up to $500 per day per property. The law takes effect in December.
Some of the maintenance requirements of new Mortgage-in-Default law:
“Properties . . . shall be kept free of weeds, overgrown brush, dead vegetation, trash, junk, debris, building material, any accumulation of newspapers, circulars, flyers, notices except those required by federal state or local law, discarded personal items including but not limited to furniture, clothing, large and small appliances, printed material or any other items that give the appearance that the property is abandoned or not being properly maintained.”
“The property shall be maintained free of graffiti or similar markings by removal or painting over . . . “
“Pools and spas shall be kept in working order so that pool and spa water remains free and clear of pollutants and debris.”