SPRINGFIELD, MA On August 22nd, the Springfield City Council unanimously passed two history making ordinances to mitigate the impact of the foreclosure crisis on tax payers and the City of Springfield. Mayor Domenic Sarno signed the ordinance the next day to be implemented within the next two months. This ordinance, which has overwhelming support of the community, will have an immediate effect on reducing foreclosures within the city limits and protecting property values.
The new ordinances create a meditation program and establish a $10,000 bond to secure and maintain residential vacant foreclosed properties. If the properties are maintained or avoid becoming vacant, foreclosing institutions are reimbursed 95 percent of the bond.
“Whether foreclosed or not, Springfield taxpayers and homeowners have had to bear the burden of un-kept properties, increased crime, blight and free-falling property values associated with the foreclosure crisis. This legislation is the first step in ensuring that our communities are protected and parties are held accountable,” explains Springfield City Councilor Amaad Rivera.
Days after this legislation was to be implemented, the Springfield City Solicitor received a letter from the Massachusetts Bankers Association (MBA) refuting the language, questioning the legality of the ordinances and threatening a lawsuit. The MBA is an organization whose membership includes Bank of America.
Bank of America has more foreclosures in the city of Springfield than any other bank. All of the other undersigned institutions on the letter have become the owner of zero residential properties after foreclosure in Springfield.
“This letter shows that Bank of America and the other big banks are willing to spend unlimited sums of money to put forward a frivolous lawsuit to avoid accepting responsibility for their role in destroying our community. The people of Springfield took concrete steps to hold the big banks accountable for their predatory practices, and we will not be deterred by threats from the very institutions that seek to bankrupt the city of Springfield,” says Springfield resident Candejah Pink, who was foreclosed on last October and still lives in her home.
This legislation has been vetted by local and statewide attorneys and by foreclosure experts at a national level. Similar ordinances passed in Worcester, Boston and other municipalities have been implemented without legal challenge.
“Mandatory mediation has proven to be the most effective way to modify loans, keep borrowers in their homes and stabilize our communities. Over 20 other cities and states have mediation programs that have a success rate of between 50 and 60%. Springfieldshould be commended for their leadership and innovative approach to stem the tide of foreclosures,” said Nadine Cohen Managing Attorney for the Consumer Rights Unit of Greater Boston Legal Services.