Banks Booting Families and Leaving Homes to Rot: A Tour of Blighted Homes in Los Angeles

These enormous economic shifts imprint people at an incredibly deep level. We feel it. When we wake up in the morning. We are going through the pain of this one. We are having our lives changed by this one.  We take with us through our days the big sack of worry for our kids with this one. It’s on our streets. You see it in the overgrown lawns and boarded-up windows of some of those bank-owned homes.

There’s a loss. A deep loss of trust. And it stays even when the DOW is up. Even when the tickers are going and there’s hopeful news on the radio about the housing market. We are suffering a kind of punishment from this recession. From all the terrible lies that came before. This is what remains. Distrust. Fear. Worry.

We know the foreclosure crisis began with the lies. The banks gave home loans to anyone with a pulse, provided they had another sucker institution lined up to buy the loan. How did they make these loans in the first place? By committing every kind of lending fraud imaginable—particularly by entering fake data on home loan applications magically turning minimum wage janitors into creditworthy wage earners.  

And we wanted those loans and we wanted to be worthy. We wanted to have that dream. Some of our families traveled here by way of Route 66, one of the original U.S. highways often referred to as The Mother Road. Our families came in pursuit of abundance and diversity. Even today mobility remains at the heart of the California dream.  It is supposed to take the sting out of the widening gulf between the have-mores and the have-nots.

In 2006, according to report by Credit Suisse, a whopping 49 per cent of the nation’s subprime loans were “liar’s loans,” meaning that lenders could state the incomes of borrowers without requiring any proof of employment.

And this stench of a feeling, this pain, this worry that we drag with us throughout our days— that to me is what obsesses me. That’s what’s eating at me.

In May 2010, the City of Los Angeles passed a Foreclosure Registry Ordinance designed to “protect neighborhoods from becoming blighted.”  The ordinance requires banks to register properties with the city of Los Angeles  that they have foreclosed on or as soon as they begin the foreclosure process by issuing a Notice of Default (NOD).  It imposes tough fines of up to $1000 per day on banks that fail to maintain those properties.

Two years later, bank-induced blight continues to ravage our neighborhoods, yet not even one bank has been fined for violating the ordinance. Because of a major loophole which lets banks register for free with a banking industry-created private service known as the Mortgage Electronic Registration System (MERS), only about 21% of foreclosed and foreclosing properties in Los Angeles have even been registered with the city. MERS does not provide the city lists of the properties registered with it, depriving officials of the information needed to police bank-induced blight.  Examples from other cities demonstrate that stronger enforcement could produce much better results than we have seen in Los Angeles.

Concerned about the level of unchecked blight in our communities, activists from ACCE, Good Jobs LA, and the Service Employees International Union fielded a team of a few dozen community-based “blight busters” in April and early May to find and report neighborhood-scarring blight. During the first three weeks of this community-based effort, activists found at least 460 bank owned properties with conditions that appear to violate the ordinance.



Fees/Fines Issued and Collected

Fines Issued and Fees Collected per Foreclosed Unit



Issued $1.8 million in fines and collected $550,000 in revenues from 2008 to 2011.

 $ 2,287.17

Chula Vista


In its first year issued $1.4 million in fines and collected $112,000 in registration fees

 $ 1,027.17



Issued $7 million in fines during FY09-10 and collected $3 million in fees and fines.

 $ 2,706.88



Collected $1.6 million in fines and fees

 $ 632.91

Los Angeles


Collected $2.1 million in fees, to date; $0 in fines

 $ 111.39

Sources: Realty Trac, May 10, 2012; US Census Bureau; Riverside, Chula Vista, Oakland Code Enforcement Officers; NYTimes; LA Housing Department, January 2012 Registry report.

Those are the numbers but here’s the heartbreak—the three homes that I saw devastated the surrounding neighborhoods. The first home I went to on 56th St. in south Los Angeles, had good steady bones. Looked lovely from the outside. The window was broken. The door was unlocked. Wide open. We walked in and spray-painted on the white wall opposite a fire mantle were the words “I HIT NAPPY BUSH!”

The upstairs walls and kitchen counters covered in gang graffiti. A loft area upstairs filled with used condoms. Doors and closets covered in curly cursive handwriting—the lyrics from a song “Cash rules everything around me” along with girl’s names, phone numbers, and prices. This place was doubling as a brothel. Some neighbors told us that during the day they used young girls 12 to16 years old and at night adult women.  According to RealtyTrac, this home has been owned by Deutsche Bank since June 6, 2011 (346 days). The penalty they would owe the community for this house would be up to $100,000.  But that doesn’t put a price to the girls. When I was leaving I saw two kids walking behind the house using it as a shortcut home. I wanted to scream out to them, “No! Don’t do that! Stay away from here!”


Los Angeles.  Los Angels.  The Angels. The lights. Twinkling. Say it. Los Angeles.  Let the slight whisper of it curl around your tongue.  To say it—it sounded like a cupcake. Like a cherry on top. They came here. They came here with images of celebrities dancing in their heads.

Do any of the CEOs of Deutsche Bank have little girls?


The next house I went to was on the 1100 block of New Hampshire Blvd., also in the south Los Angeles area.  Up the road was a community garden. Across the street was a home owned by a family that made an obvious effort of keeping up their property. They had a front yard, an avocado tree, a place clean and safe for their kids to play out front.

This home was severely blighted. Furniture in the front yard. The back covered in gang graffiti, Hoover St. Crips.  Behind the house was a shack covered in graffiti, used as an outhouse.  The back door unlocked.  Inside evidence of squatters. Drug use, urine, wet carpets, fleas, empty 40 oz. bottles of beer, trash, clothing, the copper pipes were ripped from the walls. A young woman in her twenties floated into the backyard. She looked lost in a daze, dreamy, pretty eyes, bohemian looking with dreadlocks and a red wig.  I told her we were going to be inviting media to the home. She should probably leave if she didn’t want to be on television. She giggled and kept on walking. She was high as a kite.  She drifted around in a thick gluey haze.


My mom and I came here by the Greyhound. The dog is what we called it. It smelled like ketchup and urine. It was a twelve-hour ride. We were headed somewhere new. Somewhere glamorous.

Here in this place we were a couple of nobodies.  You don’t know how many times since I’ve done intakes at cold weather shelters, emergency homeless shelters with nothing but a cot and a hot meal, how many times I’ve looked at a mother-daughter duo straight in their eyes and thought I know you. You came here with big plans. You saw the movies, you came on over didn’t you? You don’t know how awful it is to hand a beautiful hopeful girl a thick woolen blanket filled with lice.  

That’s how I felt then when I looked at that woman. I look at these women, they’re whispers of who they were. Whispers of a mom. Whispers of a tomboy, whispers of an actress, seamstress, waitress, cook, teacher doctor.  These women came here because of some such thick strong pull and they found themselves smack dab in front of me at my intake table.


On the floor in the living room amidst the blankets, clothing, condoms, trash, there was homework. English. Verb tenses and conjugations.  More kids. This home was owned by Guild Mortgage Company.  A mortgage company in San Diego.  They would also be implicated in the ordinance.  


The last home we visited was located on the end of a busy Wilmington Ave. There were at least fifteen people encamped there. The signs on the windows indicated that this home belonged to Bank of New York Mellon but upon further investigation we determined it was later transferred to Bank of America.  We told the squatters that we were organizing a tour of blighted homes for city council and media and thought perhaps they would want to leave. They refused.  

Some gang members (identified by the tattoos on their arms and necks) from down the street overheard community activists talking about the ordinance. That this home was owned by a bank and owed the community $1000 per day it was in disrepair. The gangsters liked the sound of that.  This home was serving as a crack den and infesting their neighborhood.  They said that the squatters even dragged a young girl in here once, gave her drugs, and raped her. They assured me they’d take care of it.

They went in and cleared the home out within minutes.Along with the people they had to clear out two dogs in back. The gangsters thanked the activists. They wanted something to be done about this house for a long time—something that lasted longer than their last minute sweeps. Something that made the big banks responsible pay for this. Worse than the house just sitting here was the message it sent to everyone in the neighborhood. You don’t matter. Nobody cares. Finally on this day they felt like someone cared. They asked to not be on camera because of their obvious gang affiliation.

One of our researchers clutched my arm as we walked in together. We were met with the harsh stench of mildew. There was piping falling through the ceiling. The house was full of furniture, left-behind stockings, wigs, shoes, gasoline cans. Running water and the electricity. There have been previous cases of children hurt playing in abandoned homes with running water and electricity that caught on fire. There were mosquitos, fleas.  You couldn't walk in more than five feet without wading into a puddle of water up to your ankles.  Little glass stems littered the floors.

These past weeks, each night I close my eyes, images of these homes stampede through my mind.  Used condoms, graffiti, syringes, empty 40 oz. bottles of beer, bugs, soiled carpets, soiled everything, women’s shoes, wigs, glass pipes, little plastic roses, clothes, children’s clothes, copper plumbing missing.

The homes that don’t have pipes missing and those that do - let me know what type of squatter we’re dealing with. It’s the difference between a person that steals your car and takes it for a joyride and the one that steals your catalytic converter. The one that steals your catalytic converter is selling off the parts.


When the media contacted the banks regarding this last home they actually had the nerve to send this response to one of the reporters at La Opinion:

Patrice Kozlowski forwarded me your email about your tour of abandoned houses in LA, in which you noted we are owners of a property. We are most likely the trustee for that property, and not the owner/servicer. Unfortunately, I cannot find out until tomorrow morning EDT who the servicer is, and it is kind of unfair for you to be getting to us well after 5 pm EDT and asking for a comment by 5 pm PDT.

Once I have information about the servicer. I will provide that tomorrow. But please take note of the explanation below as our role as trustee.  If you have any questions, please call my cell [412 266 8234], as I am leaving the office as soon as I send this to you.  Thanks.

As trustee, we have no powers or duties with respect to the foreclosure, maintenance, sale or disposition of properties Those powers and duties fall exclusively to the servicer. So while foreclosure action related to properties held in the trust must be brought in the trustee's name - which is why such properties are listed in the trustee's name - the foreclosure activity itself is coordinated, litigated and managed entirely by the servicers.  This includes the maintenance and up keep of the properties when that's necessary. 

For any of you that have had the misfortune of defaulting on a loan it should come as no surprise that determining who owns these properties is a large part of the frustration. Everyone pointing the finger somewhere else. As was explained in this Sentinel Sun article when a family unfortunately lost the life of their son who drowned in the pool of a bank owned blighted property in October of 2009 in Mirmar, FL.

Banks shift the blame, saying maintenance isn't their job but the responsibility of another bank company known as a "loan servicer." And they delay or evade accountability simply because they are faceless institutions, usually based in other states, even other countries.

Overall, at 975 properties, or 24.5% of houses visited, teams found some signs of blight, including debris strewn lawns, unsecured entrances, evidence of drug consumption and distribution or other signs of crime.   A total of 316 properties were seriously blighted.  Only 16% of the blighted properties are registered with the City of Los Angeles under the Foreclosure Registry Program. 

Financial Institution

Seriously Blighted

Somewhat Blighted

Blighted Total

Fannie Mae




Bank of America




Bank Of New York




US Bank




Wells Fargo




Deutsche Bank








Freddie Mac














Of the blighted properties, at least 460 are listed by the private data service RealtyTrac as bank-owned.  The others are in the process of being foreclosed.  Of these properties, 455 have been bank-owned for at least 130 days, as of this writing on June 1, 2012. This means that if properties were inspected by the City of LA at the time that the bank took possession, each of these properties might have incurred fines of up to $100,000, for a total maximum fine of $45.5 million.  All major mortgage lenders were implicated in this. Ten financial institutions own or are in the process of foreclosing more than half the blighted properties we visited.  

Just a couple days after our blight tour one of the homes was immediately cleaned up.  It does look like there is interest in updating this ordinance. Councilmember Jan Perry, who is running for mayor, came on the blight tour and she can be heard speaking here in this radio interview. And Councilmember Eric Garcetti, one of the initial authors of the ordinance, also running for mayor, has some council hearings scheduled to discuss an update in language on the ordinance. Politically, it makes sense, being that this is a revenue-producing ordinance for the city in a time when we suffer from so many budget cuts.

Initially I may have looked at these homes and thought of all the money that we could have collected for them, how many teachers that could have paid for, how many roads that could have fixed.  How many good union jobs that could have been created.  Today I think of how many young kids' lives were impacted.  I think of that dream. Los Angeles. Los Angels.  Say it. Like a cupcake, like a wish. I think of lots of pearl boba brown eyes going hard and cold. Covered in graffiti.  There’s no amount, no fine there for the damage that’s been done.


A Los Angeles City council meeting was held on Wednesday, June 6, 2012 and it was voted unanimously to remove the MERS exemption language from the anti-blight ordinance. In addition there is a council hearing scheduled for Wednesday June 13, 2012 to inquire about the other remedies and amendments we were seeking for the ordinance (mostly dealing with enforcement measures requiring Building and Safety to report regularly on fines collected etc.). In addition, community members in the city of Inglewood are inspired by the work accomplished in Los Angeles and will likely be moving on a campaign similar to ours within the next two weeks. Lastly, a summer jobs program has been created and to date we were able to procure funding for ten people to go out and inspect bank owned properties. This quiet noise is the sound of success. It’s one for us. This is what happens when community and journalists and civic engagement come together.

It’s a small part of that promise we were seeking when we came.


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