Chicago Mandates that Lenders Register and Maintain Vacant Properties Before Acquiring Ownership


Since the onset of the recession, we have become well familiar with the nationwide foreclosure crisis, particularly as to residential properties. Cities and states have grappled with how to address the adverse impact on neighborhoods and communities of properties that have been abandoned by the owners or that sit vacant after foreclosure. Vacant properties are subject to increased vandalism and attract criminal activity, and the absence of an on-site presence can lead to a decline in the maintenance of the building and grounds.

Some local governments require buildings to be registered when they become vacant, so that the local government can identify potential problems. To deal with abandoned and run-down properties, local governments have traditionally used the tools of building inspections and code enforcement actions to ensure that properties are maintained and secure. Property owners can be cited and fined for failure to comply with minimum standards of maintenance. The local government also has the right to perform the maintenance and secure the property or, in certain cases, demolish the improvements. Such fines and any amounts expended by local government are secured by a super-priority lien against the property.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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