What to do if you're living next to a foreclosed home
Renzo Salazar maintains the yard around a foreclosed home after the bank hired him to keep the home from falling into complete dilapidation on Nov. 10, 2011 in Miami, Fla. Maintenance of a foreclosed home could help protect other homes in the neighborhood.
Jeremy Hobson: Later this morning, President Obama will outline his plans to help homeowners who owe more on their mortgages than the value of their homes. It's a problem that affects almost 30 percent of Americans, according to a recent survey. And often, the problem can be blamed in part on a foreclosed home on your block.
For more, let's bring in L.A. Times consumer columnist David Lazarus. Good morning.
David Lazarus: Good morning.
Hobson: So how big of a problem is this, David?
Lazarus: Well it's a really big problem, because one in every 69 homes had a foreclosure filing last year, and more than four million homes have been lost to foreclosures over the last five years. Millions of homes in the proximity of foreclosed homes are affected by this. According to one study, the average hit to a home near a foreclosed home is over $7,000 in property value. So you're going to feel it.
Hobson: What are you supposed to do if you're one of these people who's keeping up with your mortgage payments, but the people next door have been foreclosed on and their house is in disrepair?
Lazarus: First thing you've got to do is find out who owns the home. If it's been foreclosed on, it still has an owner and that's the bank, and it is the bank's responsibility to maintain that property, only they've got such a glut of foreclosed homes. A lot of banks kind of aggregrate the responsibilities. Call up a local real estate agent. Find out which bank owns the property, call the bank. Have your neighbors call the bank. Also, organize a neighborhood watch, because empty homes have a habit of drawing thieves, squatters, drug dealers, things like that. You want to circle your wagons as a neighborhood and make sure that you're protected.
Hobson: And if the bank is not responsive or the owner of the home is not responsive, should you go so far as to actually go and take care of the property next door or down the street to try to keep the value of your home up?
Lazarus: You know, that's always the big question. I would say yes, because you're protecting your own investment, you're protecting your asset. So how much is it going to kill you to go over there and mow the lawn on the other property or get your neighbors to take turns doing that? Some people say that you should park your car in the driveway of the empty home to give the impression there's somebody there. Then the real question is how much further do you go? Do you paint the walls? Do you put up curtains in the windows? I don't know if I'd go that far, but I would definitely take every step that I could in making sure that property didn't look abandoned.
Hobson: L.A. Times consumer columnist David Lazarus. David, thanks as always.
Lazarus: Thank you.