Lenders Being Threatened with Legal Suits in Atlanta
Each passing day the going is getting more and more tough for banks. Lenders are being threatened with legal suits in Atlanta. Other big cities are mulling over plans to take similar action and dragging the lenders to court.
Most of the city officials blame the risky lending perpetrated by many banks and financial firms to be responsible for the staggering rise in foreclosures in Atlanta. City Hall has had to face many problems because of this. Plans are afoot to hire a law firm to see what legal options the city has to bring the culprits to book. By April 20th the matter would be decided by a vote.
Elizabeth Chandler the Attorney of Atlanta said that right now they did not have in front any potential defendants and went on to explain that the entire measure was right now in the “exploratory stage.”
Other important cities thinking along the same lines are Baltimore, Buffalo, New York, Cleveland and Memphis
The officials of Atlanta as yet do not have details of how many foreclosures have already happened but what they are full aware of is the impact it has had on the economic and social health of the city. According to foreclosure laws in Atlanta it is possible to collect taxes during foreclosure from the previous owner but the value of the properties are lower than the adjacent houses. Vacant houses pose law and order problems attracting vagrants and criminals.
The maximum number of foreclosures took place from 2006 to 2008 marking an increase of 42%. It jumped from 9,334 in 2007 to 13,292 in 2008.
Revenue from property tax fell by 15.5% from what was expected from July to December 2008. Consequently Atlanta, like all other jumbo cities, had to lay off workers in huge numbers and discontinue many essential services for lack of funds.
Attorney William Brennan has taken up assignments on behalf of many foreclosure victims. He strongly feels that the city should go ahead with plans for suing the banks – many of who have taken bailout money and done nothing about it. He said the lenders “offered loans to people who could not pay and they knew that. The city’s tax base eroded tremendously. Now, [the lenders] are getting the bailouts and the cities are holding the bag.”
Senator Vincent Fort (Democrat) said that the city should have taken this action much earlier. He noted that many in the government have close business connections with important banks.
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