Jorge Elorza is a law professor at Roger Williams University in Rhode Island, he is a judge on the Providence Housing Court, and, if the rumors prove accurate, he’ll soon be a candidate for Mayor Providence. Born and raised in that city’s Guatemalan community, he is the son of undocumented immigrants who went on to Harvard Law School. In between those stops, he studied at the University of Rhode Island and went on to work on Wall Street. When one of his friends back home was tragically lost to violence, Jorge felt compelled the return to his hometown and work to improve the community. He became an attorney for Rhode Island Legal Services, and specialized in housing law – something which has profound ramifications for the community he served. In 2009, he helped found the Latino Policy Institute at Roger Williams University and remains co-chair of its board of directors.
Like most cities throughout the country, Providence was hit hard by the collapse of the housing market. Quicker to fall into recession and slower to recover, the city has seen many properties fall into disclosure, abandonment, and decay. In his position on the Providence Housing Court, Elorza saw the impact that these crumbling houses were having on the surrounding neighborhoods. The problem was, they weren’t really any one party’s responsibility – that is, until he found a unique approach to addressing them. By hauling the big banks into court and demanding action, he’s been achieving results that can serve as a model for cities nationwide.
Tell me a bit about this process you’ve initiated to hold banks responsible for abandoned properties.
The usual story is that a homeowner falls behind on their mortgage payments (often because they lost their job). After a few months of being behind on their mortgage, the homeowner receives a perfunctory “Intent for Foreclose” notice from the bank. The homeowner abandons the home, they leave the state, they file for bankruptcy, or something else – the point is that they abandon the home. However, after the homeowner abandons, the bank doesn’t actually follow through on the foreclosure. The house then sits empty and it can take years before anything happens. In the interim, the house falls into disrepair, thieves enter and steal the copper piping, squatters move in and vandalize the home, kids break the windows, the grass overgrows and harbors rats, and the home becomes an eyesore in the neighborhood that brings everyone’s home value down.
In the housing court, we have jurisdiction only against the homeowner. Therefore, the banks are not responsible for the home until they actually complete the foreclosure. And since the banks have no interest in maintaining the properties (and they have already written off the losses), they are in no hurry to foreclose.
I started issuing subpoenas to the banks ordering them to appear before me as “parties of interest.” I ordered them to tell me two things: 1) What’s your plan for the property? And 2) What’s your timeframe? At first, they didn’t appear, so I found them in contempt. I had to fine them hundreds of thousands of dollars; I even had to threaten to arrest one of the bank’s presidents. They finally appeared before me and, to their credit, they have repaired and taken action on every property that I brought them to address.
Has anything like this been done before? If not, why?
To the best of my knowledge, there isn’t another housing court in the country doing it – I’m not sure why. It took me a lot of research and effort to begin the process. I see the impact that these homes have on the surrounding neighborhoods and I understand the urgency that they require. This was an issue that I felt compelled to address. When I began, I was a bit unsure of how it would play out, but it has turned out to work phenomenally well.
Why do you think this was important? Was it a symbolic victory or is it actually achieving results?
Yes, there are tangible results that have come from this. First, many previously abandoned homes have been repaired and maintained pursuant to my orders. These are homes that there hasn’t been any movement on for years, and they are now on their way to coming back into the market. In fact, in response to my orders, Bank of America established a nationwide system to respond to complaints and issues from housing courts.
Also, some of the banks have assigned attorneys to take proactive steps to prevent homes from continuing to deteriorate. For example, one of the banks has appeared on its own initiative and taken responsibilities for some abandoned properties. The attorney usually communicates to the court that the bank is reviewing the file and will address the issues within 30 days. In addition, not only have banks taken responsibility for certain properties but they have also agreed, in court, to communicate with the homeowner to modify the terms of the mortgage. This has occurred after the homeowner has spent years trying to contact someone at the bank.
Now that you’ve achieved this in Providence Housing Court, are you passing the knowledge of this process on to other judges and courts?
After having worked through enough of these cases, I documented each of the steps in the process and I shared this with my colleagues on the housing court. They have begun using this process in their own caseloads and once the process is up and running, I plan to share it with housing court judges throughout the state. It is a relatively simple process, but it is one that has worked extremely well.
Has anything like this been done in your city? What, if anything, is being done to address abandoned properties where you live?