Zombie properties results when residential properties are vacated or abandoned by an owner in default on their mortgages. In an article in the Westchester Business Journal on June 1, 2015 by John Golden, he points out that Gov. Andrew Cuomo recently announced New York State’s agreement with 11 banks, mortgage companies and credit unions that represent 70% of the New York mortgage market. The agreement is to eliminate neighborhood blight of vacant properties where owners face foreclosure. There are about 16,700 zombie properties statewide in 2014. Lenders met to address the zombie property problem. New York State is expected to implement by August, 2015 that lenders agreed to conduct an exterior inspection of the property within 60 days of delinquency to determine vacancy and abandoned properties and every thirty days thereafter.
If the property is found to be vacant and abandoned, the lender will secure each unit by changing the locks, replacing or boarding up windows, posting the property with contact information and eliminate safety hazards. Lenders will also notify New York State’s Department of Financial Services of any new property to be added to the State’s reporting of vacant and abandoned properties. The Financial Services Department will accept complaints from neighbors or local officials about vacant properties.
Under existing law property owners are responsible for the maintenance of their properties. Bank and mortgage companies are not required to maintain vacant and abandoned properties until they receive a judgment in foreclosure. The Abandoned Property Neighborhood Relief Act has been introduced in the New York Legislature. New York Attorney General, Eric T. Schneiderman called the agreement “a welcome step forward to stop the epidemic of vacant zombie homes”.