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Lackawanna to pursue $500 daily fines over zombie house

Add Lackawanna to the growing list of communities waging war on "zombie" homes thanks to recent state legislation that allows municipalities to slap derelict lenders with a up to a $500 daily fine.

Under the Foreclosure Relief Act, the lender has the duty to maintain and secure a residential property where there is a reasonable basis to believe it is vacant and abandoned. The lender faces civil penalties up to $500 per violation, per property, per day for failing to do so.

State officials believe the legislation will become a critical tool in fighting the ‘zombie crisis’ in our communities.

"Proactive engagement by neighbors, courts, municipalities and banks is required to increase the likelihood of success," said Assemblyman Michael P. Kearns. "I applaud Lackawanna officials in their efforts and hope this legislation will help address bank-created blight by facilitating earlier detection and maintenance of these properties.”

There are approximately 70 zombie homes in Lackawanna, said Fred K. Heinle, director of development. A zombie home is a property that the homeowner abandoned because he or she assumes the bank now owns it.

"It's very difficult to determine the cause of the abandonment and vacancy," said Heinle.

He pointed to a zombie home at 79 Warsaw as an example.

"The owner could not make the payments," said Heinle. "Foreclosure proceedings were started in 2014 against the owner of the Warsaw property by lender Ditech Financial. She moved to Hamburg."

The homeowner also got a realtor, who tried three times to sell the property, which had incurred numerous citations for code violations, said Heinle.

"One of the short sales drew an offer upwards of $30,000," Heinle said. "It needed a complete interior upgrade. Ditech refused."

The online real estate website says the property is listed for sale at $43,500.

Officials identified this vacant house at 79 Warsaw St. in Lackawanna as a zombie property.

Attempts to reach Ditech at its corporate headquarters in Fort Washington, PA., were not successful.

Kearns said that despite reasonable offers,  Ditech continued to hold the property ransom. Utilizing the Foreclosure Relief Act enacted in 2016, Lackawanna will pursue the $500 daily fine against Ditech for not complying with the law’s maintenance requirements, Kearns said.

Kate Lockhart of the Western New York Law Center was pleased to see Lackawanna take an active role by utilizing the relief act.

"Ditech's actions make it clear that they are not considering the community in their decision-making process," Lockhart said.

Officials who gathered at the house recently to draw attention to the blight included Mayor Geoffrey Szymanski, Second Ward Councilwoman Annette Iafallo, First Ward Councilman Abdulsalam K. Noman and Heinle.

"It is long overdue that we hold the banking industry accountable for the blight and neglect that they force upon our communities," said Szymanski.

"Shame, shame Ditech Financial," said Iafallo. "Leaving homes like 79 Warsaw abandoned and in disarray is unacceptable and will not be tolerated. We ask that this home be repaired properly and sold to a good family. Please be a good neighbor."

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