City Of Buffalo Suit Over Vacant Abandoned Foreclosures The First In What May Be A Wave Of Legal Actions Against Lenders

In New York, The Buffalo News reports:

• The city is suing 28 national lenders and servicers — including two local banks — to recoup between $1 million and $2 million it estimates it will have to spend on securing and demolishing 58 vacant properties. In doing so, it’s trying to address the problem caused when no one takes care of a house. The lawsuit seeks to hold the lenders responsible, and accuses them of allowing the houses to “become so dilapidated, deteriorated, abandoned and/or decayed so as to present a danger to the health, safety and welfare of the public.”

• The lawsuit says the servicers “have failed to take appropriate action to protect or dispose of these properties,” and it says the conditions of the houses violate both city and state laws. And it asserts that the city now “has a duty to abate these nuisances by demolishing the abandoned and blighted structures.”

• “This is the first lawsuit that I would expect in a series. It’s our first strike in a wave that would obviously focus on more,” said Alisa A. Lukasiewicz, Buffalo’s corporation counsel. “This is our attempt to have banks take responsibility without walking away from properties.” The lawsuit covers a small fraction of the total number of vacant properties citywide, but sought to include a broad swath of the mortgage servicing industry among the defendants. “We considered these to be some of the most severe properties,” Lukasiewicz said. “To the extent that there are more properties, we will definitely be naming those as defendants in further actions.”

For more, see Buffalo sues lenders over abandoned houses in foreclosure (City wants them to pay for demolition when owners are forced out after foreclosure) (if link expires, try here).

To view the lawsuit, see City of Buffalo v. ABN Amro Mortgage Group Inc., et al. (3.67 MB; lawsuit also available here, courtesy of the law firm Skadden, Arps, Slate, Meagher & Flom LLP). If there's a problem with this link, email me at HomeEquityTheft@yahoo.com and I'll email it to you (please put "City of Buffalo v. ABN Amro" in the subject line).

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