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Rundown Houston homes caught in red tape

01:10 AM CDT on Tuesday, April 1, 2008

By Dave Fehling / 11 News

Click on video for Dave Fehling's 11 News investigation

HOUSTON -- Foreclosures in Harris County are up 16 percent compared to a year ago, which is why you might find it interesting what we found out about homes that were “foreclosed on” many years ago.

Every neighborhood has its mysteries, and on a street named Celia in East Houston sits what years ago must of have been a cozy little house with a piano that now is way off tune and a big backyard that’s now a jungle.

Jorge Hurtado lives across the street.

He has to look at it every day and, “worry about it because it’s dangerous for everybody,” he said.

The neighbors agree, but who will do anything about this house where no one has lived for some 15 years?

Usually, when you find a house that’s in this bad of shape, it’s been abandoned. But this horrible house does indeed have an owner and that owner has a name: Sam, Uncle Sam.

According to county property records, the owner is the RTC: the Resolution Trust Corporation.

The RTC was setup by the federal government in the late 1980s after the economy tanked and thousands of homes in Houston were lost to foreclosure.

“It wasn’t just homes,” Harris County Appraisal District spokesman Jim Robinson said. “We had major commercial property, vacant land, shopping centers … [owned] by the federal government.

“They generally sold them off,” Robinson said.

But here’s where the mystery of the house on Celia takes a twist. The city has been aware of the house for years, posting notices, documenting its deterioration and all the while assuming the federal government owned it.

“I have in three years had no contact with the government on this site,” said E.C. Day with the Houston Neighborhood Protection Division.

The city couldn’t seize the house because by law one governmental entity can’t take another’s property.

But why would the federal government be so irresponsible?

11 News spoke to an official with the FDIC, which took over the RTC. He checked their records and said the government sold the house 13 years ago.

But the records are so old, he said they don’t know who bought it.

The official said it’s likely the home was bundled with other low-value properties and auctioned off to what the official called bottom-feeders: investors who bought up properties dirt cheap.

If the properties turned out to be bad investments, the investors would never bother to have the land titles put in their names, they’d simply abandon the homes.

They’d washed their hands of them, and so had the federal government.

If a house ever became a problem, the problem wasn’t the investors’ or the federal government’s.

In this case, it became the problem of the Hurtados and the Moraleses and everyone else on Celia Drive.

“I hope they do something because really we need it,” Hurtado said.

And now, maybe someone will.

Since 11 News began looking into this two weeks ago, county officials have begun researching some 20 properties listed as belonging to the RTC and other Federal agencies.

Once they verify the house on Celia is no longer government property, they say they will demolish it and sell the land — maybe this time, to someone who’ll take care of it.

Harris County Tax Assessor Paul Bettencourt said because of this story, the house on Celia Drive will become part of the “Abandoned Property” program and could be demolished within a year.

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