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Vacant Property Ordinances Updates from Four States: Maryland

Posted By USFN, Friday, May 3, 2013
Updated: Monday, November 30, 2015

May 3, 2013


by Ronald S. Deutsch
Cohn, Goldberg & Deutsch, LLC
USFN Member (District of Columbia)

A new expedited foreclosure procedure became effective in Maryland on March 11, 2013 upon the promulgation of a rules change. This procedure represents the legislature’s attempt to clear the thousands of vacant properties and properties unfit for human habitation and thereby reduce blight. In order to proceed under the new law, codified at Md. Code Ann. RP Section 7-105.11, the servicer must obtain from a county (that has established a procedure for doing so), a certificate of vacancy, or of property unfit for human habitation.

A property unfit for human habitation means: (1) in Baltimore City, a certificate of substantial repair; or (2) a certificate for residential property issued by a unit of a county or municipal corporation indicating that the county or municipal corporation has determined that the residential property is unfit for human habitation. Similarly, a certificate of vacancy means a certificate issued by a unit of a county or municipal corporation for residential property, indicating that the residential property is vacant. So, in both cases a government entity makes the determination.

A county or municipal corporation may charge a fee not to exceed $100 to a secured party to issue a certificate of vacancy or a certificate of property unfit for human habitation. When a certificate of vacancy or a certificate of property unfit for human habitation has been filed with the order to docket or complaint to foreclose, the rules delineated in 7-105.1(c) that require a notice of intent and waiting 45 days after same (or 90 days after default, whichever is later) before docketing are no longer applicable. That said, the borrower maintains the right to challenge an expedited filing. A challenge is initiated by filing a motion in the foreclosure action. Upon receipt of a proper challenge, all proceedings in the action shall be automatically stayed until further order of the court. The secured party must file a response within 15 days of being served with a motion to challenge. The court is required to promptly rule. If the secured party does not file a timely response, the action shall be dismissed without prejudice to refile. If the court rejects a challenge, then the stay is lifted and the case proceeds.

Because of possible legislative drafting issues, one reading of the new rule requires all papers to be served by personal delivery or by leaving papers with a resident of suitable age and discretion at the dwelling house or usual place of abode of each person served. If on at least two different days a good faith effort to serve a borrower or record owner is not successful, however, the plaintiff may effect service by: (1) mailing, by certified and first-class mail, a copy of all papers filed to commence the action, accompanied by the documents required, to the last-known address of each borrower and record owner, and, if the person’s last-known address is not the address of the residential property, also to that person at the address of the property; and (2) posting a copy of the papers in a conspicuous place on the residential property. Service under that interpretation is complete when the property has been posted and the mailings have been made. Under an alternative interpretation, personal service may be the only effective method of service and posting would not be allowed. Under both interpretations a notice “to all occupants” must sent.

To date, this author is unaware of any counties having established a procedure for the issuance of the certificate required under the statute. Baltimore City, however, advises that it will issue a certificate of substantial repair, and that it does have an adequate program in place, which suffices under the new rules.

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