Sacramento steps in when foreclosed neighborhoods rot

The same industry whose lax lending standards led to the economic downturn is now being blamed by local officials for letting neighborhoods rot.

Those on the front lines of the battle for Sacramento neighborhoods say many banks and other lenders are either unable or unwilling to handle the mass of houses left vacant by the foreclosure crisis.

Many derelict houses are owned by lenders. Others are sitting in limbo. Lenders have begun foreclosure proceedings but haven't taken title, and the families who lived in the homes have gone.

"Banks say they want to be a good neighbor, but it doesn't always seem that way," said Pat Melanson, a supervising building inspector with the city of Sacramento.

Drive around one of the neighborhoods hardest hit – Oak Park – and the scope of the problem becomes evident.

"We're in the thick of it now," Melanson said, driving slowly up 21st Avenue, pointing out the boarded-up houses dotting the block. "That one. That one. That one. Another one over there."

Thousands of homes in Sacramento sit vacant after subprime mortgages, falling home values and rising interest rates led to widespread defaults and foreclosures.

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