Settlement reached for Federal Housing Financing Agency v. City of Chicago
Chicago, IL: Settlement for the Federal Housing Financing Agency (FHFA) v. City of Chicago case has been announced: vacant property registration fees will no longer be collected for FHFA loans, but continued registration is encouraged.
In August 2013, the court ruled the Chicago ordinance requiring mortgagees of vacant buildings to register with the city, pay a registration fee, and maintain the building within particular standards – with registration fees of $500 and fines for non-compliance of up to $1,000 – did not apply to FHFA, Freddie Mac and Fannie Mae properties, as it constituted an impermissible tax against the federal government, falling under federal preemption.
The ordinance's registration fees and fine system still applies to all private mortgagees of vacant foreclosed properties.
The settlement reached in April 2014 states that those properties remaining under supervision of FHFA – some 258,000 loans secured in the city for properties backed by Freddie Mac and Fannie Mae – will not be assessed a registration fee, while under such government supervision.
However, FHFA must continue to assist the city of Chicago in identification of those vacant properties of Freddie Mac and Fannie Mae to help mitigate economic damage brought on by persistent vacant, foreclosed buildings.
All Freddie Mac and Fannie Mae properties must continue to uphold the mission listed on the FHFA webpage of ensuring housing government-sponsored enterprises serve as reliable sources of liquidity and funding for housing finance and community investment in a safe and sound manner.
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