THE PROBLEM: Following the 2000 and 2008 financial crises followed by a slow recovery, there was a large increase in the number of deteriorating or abandoned residential, commercial, and manufacturing properties in the Bay Area. This was especially true in the City of Vallejo which suffered the double impact of the closing of the Naval facility at Mare Island, which eliminated thousands of jobs. As deteriorating properties were abandoned they were claimed by squatters, drug related crimes and neighborhood blight. Bay Area cities staff and financial resources were being consumed with increasing cost for police, fire, building & safety, and city legal services in dealing with these abandoned or neglected properties.
In addition to what occurred in Vallejo some of the most common ways the problem with dilapidated or abandoned properties occurs in California Cities and Counties are as follows.
- Deceased Owners
- Irresponsible Owners – Often Due to Age, Mental Health, or Addiction.
- Properties that harbor criminal activity
- Zombie Foreclosures
A “Zombie Foreclosure” results from a homeowner misunderstanding the foreclosure process. During a normal foreclosure process, the homeowners receive notice from the institution holding the defaulted mortgage that the house is entering the foreclosure process. They may not understand, there is a mandated waiting period during which they could pull the house out of foreclosure by paying back payments, taxes, etc. If the homeowners do not pay this lump sum, the foreclosure process should continue. However, often times banks do not follow through with the foreclosure, which leaves the Property in a state of limbo. Often the Homeowner mistakenly believes they have been foreclosed on and leaves the Property, but the Bank never takes control. Therefore, the Property is left abandoned and becomes a blight on the neighborhood, because there is no responsible Owner.
THE SOLUTION: With over twenty years of experience, the Bay Area Receivership Group (BARG) is one of the first firms in the Bay Area to specifically address this problem. BARG has a demonstrated expertise in working with all City Departments, personnel and contractors. BARG’s core tool is their expertise in implementing Health and Safety Receiverships under California Health and Safety Code section 17980.7. Health and Safety Code section 17980.7 provides a mechanism for the courts to appoint a “Receiver” to : 1) arrange for all project funding required for the complete property restoration, 2) coordinate all aspects of the restoration with the property owner’s/or their estate, or other entities which own the property, 3) hire and oversee all court approved architects & contractors, 4) coordinate with Building & Safety for code /permits compliance, and eventually reselling of the restored property shortly after restoration. Throughout this process BARG reports to the court on a scheduled monthly basis pursuant to California Rule of Court 3.1182 on the status of the restoration to ensure complete transparency with all transactions associated with the restoration and selling of the improved property. Since the restoration of a distressed property is important to the any neighborhood, the Bay Area Receivership Group also keeps neighbors informed of the progress and how the City Leaders placed an emphasis on maintaining property values, as well as the health and safety of the community.
In closure, BARG understands the unique culture, heritage and businesses/ government codes and standards of the Bay Area. That is why we have chosen to continue to focus on our home the San Francisco Bay Area. Even though BARG primarily focuses on the Bay Area BARG does operate statewide.