June 28, 2011 [Housing Wire]
Wells Fargo ($40.66 0%) and Bank of America ($12.93 -0.26%) will donate a number of vacant and foreclosed properties to Cleveland-based Cuyahoga County Land Bank and pay for demolition costs.
The Ohio legislature established the Cuyahoga County Land Reutilization Corp. in April 2009 to acquire foreclosed properties held by banks, government-sponsored enterprises and federal or state agencies. Fannie Mae, the Department of Housing and Urban Development and JPMorgan Chase ($53.55 0%) already assist the Land Bank in returning these properties to productive use.
Wells and BofA signed agreements a few weeks ago to begin donating such properties as well, the CCLRC said Tuesday.
BofA will donate up to 100 vacant properties, and Wells already gave 26. Both banks will contribute $3,500 per property for demolition in areas the Land Bank targets with Neighborhood Stabilization Program dollars. The firms will also donate $7,500 per property in the rest of Cuyahoga County.
“The Cuyahoga Land Bank is thrilled to be adding Bank of America, along with Wells Fargo, to a continually growing list of partners in our efforts to eliminate blight and return properties in Cuyahoga County to productive use,” said Gus Frangos, president and general counsel for the corporation. “Each partnership we are able to establish provides us with more resources to tackle the issues of blight created by foreclosure and abandonment within our communities.”
BofA made similar commitments in Detroit and Chicago. Rebecca Mairone, national mortgage outreach executive for BofA, said the initiative works toward solving blight created by homeowners, who in many cases walk away from a home.
“This program builds on the initiatives we already have taken in homeownership retention, foreclosure prevention and neighborhood stabilization and revitalization,” Mairone said.
A spokesperson for Wells Fargo said there is no specific target for how many properties it will donate to the Land Bank, but it will continue to evaluate possibilities and work with investors to determine if they are willing to contribute.
Robert Klein, former CEO of the property preservation firm Safeguard Properties and REO CH, has worked with servicers to bridge the gap between them and these community organizations.
“Communities need a straightforward and streamlined way to identify foreclosed properties from financial institutions like ours, and we can be a source of funding to finance some revitalization activities,” said Russ Cross, Midwest regional servicing director for Wells.