The ordinance, introduced by Ald. Pat Dowell and supported by Mayor Rahm Emanuel, requires any entity with a financial interest in the property to maintain a vacant home up to standards that promote neighborhood security and livability. Vacant homes are a problem that can weigh down an entire community by attracting crime and vandalism, bringing down property values, and draining public resources. These problems are exacerbated when no one is actively maintaining the home because the original owners have left and the mortgage servicer resists taking ownership, thus avoiding the associated responsibility for the home’s maintenance and security.


“The foreclosure crisis around the country is usually isolated to some parts of the city,” Mayor Emanuel points out.  “This affects everybody in the city.”


Our research on potentially abandoned foreclosed homes informed the push for this ordinance by  defining the scope of the problem in Chicago and illustrating where the biggest impacts are.  Our report, Left Behind: Troubled Foreclosed Properties and Servicer Accountability in Chicago, identified nearly 1,900 “red flag” properties where we were unable to determine a completed foreclosure auction or subsequent property transfer. We called them red flag properties because they are vacant and stuck at some point in the foreclosure process. These red flag properties indicate a lack of effective stewardship on the part of servicers and pose a substantial risk to the surrounding communities. This new ordinance gives servicers the responsibility to be good corporate citizens by making sure that vacant homes don’t destabilize neighborhoods, even if they decide not to complete the foreclosure process.


Woodstock Institute Vice President Tom Feltner testified before the City Council, saying:


“Some financial institutions have taken steps to address [issues with abandoned foreclosures], and we applaud their efforts. We believe that we need tools in place to ensure that mortgagees have the ability to maintain responsible control over vacant properties that are still in the foreclosure process. However, for those properties where servicers have been unable or unwilling to exercise effective stewardship, we believe that this proposal will introduce much needed accountability.”


We applaud City Council and Mayor Emanuel for supporting this measure, which will lessen the negative impact of foreclosures and vacant homes on Chicago. We also encourage lawmakers in Springfield to pass a similar measure so that municipalities throughout the state can ensure that vacant homes are maintained.