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Las Vegas Makes Improper Property Maintenance a Crime

Las Vegas has enacted a city ordinance that holds lenders liable for the upkeep of vacant homes even if a default or foreclosure is pending and the borrower still holds the title.


Lenders who fail to comply with the maintenance requirements for vacant properties prior to repossessing them could face misdemeanor criminal charges that carry a $1,000 fine and six months in jail.

The language of the bill states that the purpose is to ""establish a program to reduce the amount of deteriorating real property located in the City.""

Las Vegas has been hit particularly hard by the foreclosure crisis and the property vacancies and neigh-


borhood blight that tend to go hand-in-hand. The city, considered the epicenter of the nation’s housing crisis, has a foreclosure rate six times the national average.

The ordinance requires lenders to inspect all properties which are in default or on which a default is pending, and should the inspection show the property is not occupied, register it with the Department of Building and Safety within 15 days. According to the _Las Vegas Sun_, registration is $200 per property.

Lenders are required to hire or designate a property manager to inspect the property at least once a month, and maintain and secure the property throughout the default and foreclosure cycle and until the property is no longer vacant.

In comments submitted to the City Council by Nevada State Bank, the bank noted, “Neither the law nor a lender's loan documents authorize a lender to take control of real property before some form of foreclosure mechanism has taken place. We therefore urge that the language of the ordinance, and the mechanism for implementation, be cognizant of those limitations on a private lender.”

The ordinance amending the city’s municipal code and making lenders liable for the upkeep of vacant properties prior to foreclosure was unanimously passed by the city council.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.

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