Bank of America Demolishes Abandoned Houses

Image by IITA Image Library via Flickr

What to do with abandoned and foreclosed houses that you can't sell? Well, you bring in a bulldozer and you demolish them. That's what the Bank of America is planning to do. This is another way of tackling the foreclosure problem.

Residents of neighborhoods where there are hundreds of empty and abandoned houses can see the logic here. The houses are beyond an eyesore. They are a breeding ground for crime. They pose a fire hazard. They bring down the property values of other houses in the area.

There will be 100 houses in Cleveland that will be leveled. Detroit and Chicago will follow, and then other cities as the need arises. There will be a total of nine cities by the end of 2011.

Under this plan lenders will have to pay up to $7,500 to have a house demolished. Where the Neighborhood Stabilization Program is in place, this amount could drop to $3,500.

Future uses to the "new vacant" lots would be community gardens, small parks and development. Most of the houses are worth less than $12,000 and they are too far gone to salvage.

This is by no means a charitable act on the part of Bank of America. The gets a write off. So what took the bank so long to address this problem? Maybe, the bank heard news about some cities starting to charge lender for upkeep and maintenance. Chicago recently implemented a plan, and Los Angeles is still discussing something similar.

A year or two ago these houses could have been donated to a neighborhood non-profit or a church.

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