L.A. city attorney files suit against Bank of America for lost property revenue
December 8, 2013
By Kelly Goff, Daily News, Los Angeles
Bank of America for lost property revenue --> Dec. 08 -- Bank of America's
lending practices led to a wave of foreclosures and lost city revenue,
alleges a new lawsuit filed by Los Angeles City Attorney Mike Feuer on
Friday afternoon. The city is seeking unspecified damages based on the
decline in property tax revenue after the housing bubble burst. The suit
came on the heels of two similar claims filed against Citigroup and
Wells Fargo on Thursday, alleging discriminatory mortgage lending in
minority communities. "Today we begin to address the devastating
consequences of the foreclosure crisis in America's second largest
city," Feuer said in a statement. "These lawsuits send the firm message
that we will use every tool at our disposal to fight for all Los Angeles
taxpayers and neighborhoods." The city attorney's statement cites a
report by the Alliance of Californians for Community Empowerment and the
California Reinvestment Coalition , which estimates the mortgage crisis
caused 200,000 foreclosures and an estimated $78 billion in decreased
home values between 2008 and 2012. It estimates property tax revenue
losses for the same time frame to be approximately $481 million . In
communities with high foreclosure rates, the city was also on the hook
for additional expenses in safety inspections, police and fire calls,
added trash removal and some property maintenance on vacant homes.
According to the lawsuits, those additional services added up to $19,000
per vacant home, or $1.2 billion . In each of the suits, Feuer alleges
that the companies offered predatory loans with high rates to minority
borrowers, forcing entire communities into mortgages that could not be
paid, resulting in widespread foreclosure and neighborhood blight. ___
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Source: Daily News (Los Angeles, CA)
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