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Long Beach councilman facing home foreclosure [Updated]

A Long Beach city councilman has defaulted on his home loan and is in danger of losing his home just two weeks after he sponsored an ordinance that would more closely monitor foreclosures in the city.

Councilman Steven Neal’s financial troubles were first reported by the Long Beach Press-Telegram, which Monday published the lender’s notice of default and sale.

Neal and his wife, Katonja, owe more than $550,000 on the 2,319-square-foot home they bought in 2003 for $300,000. The three-bedroom house with a pool is scheduled to be sold Oct. 12 at auction.

Neal proposed an ordinance Sept. 7 that would require lenders to register foreclosures and pay a fee so the city can monitor vacant properties for maintenance and code enforcement violations.

[Updated at 2:35 p.m.: Rex Richardson, Neal's chief of staff, said the councilman was forced to default as a condition of a loan modification, but he doesn't expect to lose the home. His struggle to pay his mortgage is reflective of many other homeowners in his district, he added.

"In this economic crisis, he's no exception," Richardson said. "It impacts everybody."

The foreclosure legislation was not motivated by Neal's financial troubles, but by complaints from residents about poorly maintained bank-owned homes sitting vacant on their streets, Richardson said.

 

"There's nothing in the legislation that would play to his benefit or personal gain," he said.]

“This is designed to keep our neighborhoods intact, keep our property values up and also give the city the ability to assess fines to lenders" who are not maintaining their properties, Neal said before the City Council voted unanimously to start drafting the legislation.

Neal and his wife, a real estate agent, have refinanced their home near the 710 and 91 freeway interchange five times since purchasing it, property records show.

Neal did not immediately respond Tuesday to a request for comment.

Neal, 50, was elected in April to represent north Long Beach, an area that has been hard-hit by foreclosures during the economic downturn.

He is the second Long Beach politician in recent years to draw attention to home loan woes.

Rep. Laura Richardson (D-Long Beach) has defaulted on loans for homes she owns in San Pedro and Long Beach and lost her Sacramento home to foreclosure in 2008.

In July the House Ethics Committee cleared Richardson of wrongdoing in her dealings with the bank that canceled the sale of her home and returned it to her.

-- Tony Barboza

 
Comments () | Archives (4)

How could anyone borrow that much on a $300,000 house. What did they need that kind of money for.

Life within your means.

So I wonder if his property is going to be maintained once it's vacant.

He needs to go to the City of Bell and get one of those cool loans which are only offered to mayors and city councilpersons...They're awesome, the pay themselves off...Actually, the City of Bell residents pay them off, but don't tell them that...

>> In July the House Ethics Committee cleared Richardson of wrongdoing in her dealings with the bank that canceled the sale of her home and returned it to her.

And this is okay for what reason??


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L.A. Now is the Los Angeles Times’ breaking news section for Southern California. It is produced by more than 80 reporters and editors in The Times’ Metro section, reporting from the paper’s downtown Los Angeles headquarters as well as bureaus in Costa Mesa, Long Beach, San Diego, San Francisco, Sacramento, Riverside, Ventura and West Los Angeles.
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