Attorneys for Wells Fargo are in Cleveland's Housing Court fighting an order that bars the financial giant from selling its bank-owned houses in the city. As part of our ongoing coverage of Facing the Mortgage Crisis, ideastream®'s Mhari Saito reports.
Last Thursday, Cleveland Municipal Housing Court Judge Raymond Pianka granted a temporary restraining order that stops Wells Fargo from selling its foreclosed houses for sharply discounted rates until it fixes them up or helps pay for demolition. The Judge's reason: a significant number of Wells Fargo's properties are open, vacant, vandalized and present a health and safety risk to neighbors. Now the court is hearing arguments to extend the restraining order from the nonprofit that brought the suit, a subsidiary of Neighorhood Progress Inc. Scott King from Thompson Hines represents Wells Fargo. He argues that a ban will only hurt Cleveland more.
Scott King: The end result is that banks are going to be less likely to purchase at foreclosure sale, if that happens the harm will be greater than the situation now. When a bank purchases a property back it pays the real estate taxes, it clears the liens, maintains the property and puts it back on the marketplace.
The head of the city of Cleveland's department of Building and Housing, Ed Rybka, testified yesterday. He said the city will also file a similar suit against Wells Fargo.