Feds Sue Chicago Over Mortgage Ordinance

The Federal Housing Finance Agency, acting as conservator for mortgage giants Fannie Mae and Freddie Mac, sued Chicago in federal court on December 12.  FHFA challenges a city ordinance that requires mortgagees of vacant properties to pay a registration fee and conduct monthly inspections of vacant properties.  These requirements apply even if the mortgagee has not yet foreclosed on the property. FHFA’s suit sounds primarily in federal preemption.

Chicago’s ordinance is yet another attempt by a local government to address the fallout from subprime lending.  Cleveland, for instance, unsuccessfully sued banks for public nuisance, and Baltimore sued banks for discriminatory subprime lending based on the Fair Housing Act.  Other cities have enacted ordinances attempting to regulate or prohibit subprime lending.

The complaint in the Chicago case can be found here:  http://www.scribd.com/doc/75530336/FHFA-v-ChiTown.

This entry was posted in Uncategorized by pdiller. Bookmark the permalink.

About pdiller

Paul Diller is an associate professor at Willamette Law whose research focuses on local government, policy innovation, the police power, and related issues of state and federal constitutional law. His scholarly work has appeared in, among other journals, the Stanford Law Review, The University of Chicago Law Review, the Michigan Law Review, and the Georgetown Law Journal. In recent years, Diller has worked on local obesity prevention policy with a leading nonprofit public health organization. Diller graduated from the University of Michigan Law School and the University of Pennsylvania, both magna cum laude. In his spare time, he enjoys baseball, snowboarding, drinking coffee, and spending time with his family.

Leave a Reply

Your email address will not be published. Required fields are marked *