Scranton Registers the Mortgage, Not Just the Building: $45 for Vacancy, $200 for Default, and the Second One Reaches Occupied Houses

Most registries in this series start with a building that is empty. Scranton has one of those, and it is cheap — $45 a year. Then it bolts on a second registry that has nothing to do with whether anyone is living there. The trigger is a mortgage event: default, a lis pendens, an ongoing foreclosure, an application for a tax deed, a pending tax lien sale, or a deed in lieu. The fee is $200 a year. The duty falls on the mortgagee. And the definition says the words out loud — it applies "whether vacant or occupied."

If you service mortgages, that second track is the most consequential provision in this whole series, because it attaches at the moment a loan goes bad rather than at the moment a property empties, and it keeps running while a family is still in the house.

Two Tracks, Two Triggers

The vacant track is conventional. Sec. 360-17 defines "vacant real property" as "any structure, other than abandoned real property, that is not occupied for more than 30 days and not actively marketed", and Sec. 360-18E(1) makes registration due within thirty days of the property becoming vacant. Both limbs have to hold: thirty days unoccupied, and not actively marketed. A property genuinely on the market is outside the vacant track.

"Actively marketed" is itself defined, and it takes two things rather than one. Sec. 360-17 requires "the placement, by the owner or through an agent, of a 'for sale' or 'for lease' sign on a property with accurate contact information" and at least one of: engaging a real estate licensee, listing in the Multiple Listing Service, or distributing print advertisements. A sign alone is not enough, and an MLS listing alone is not enough.

The abandoned track is the unusual one, and its definition is worth reading in full. Sec. 360-17: "any real property located in the City, whether vacant or occupied, that is in default on a mortgage, has had a lis pendens filed against it by the lender holding a mortgage on the property; is subject to an ongoing foreclosure action by the lender, is subject to an application for a tax deed or pending tax assessor's lien sale, or has been transferred to the lender under a deed in lieu of foreclosure."

And it does not end easily. The same definition provides that "the designation of property as 'abandoned' shall remain in place until such time as the property is sold or transferred to a new owner, the foreclosure action has been dismissed and any default on the mortgage has been cured." Read conjunctively that would require a transfer and a dismissal and a cure, which cannot be what was meant on a sale to an unrelated buyer. The drafting does not resolve it. Sec. 360-18D(4) then reaches past the sale: the article "shall also apply to properties that have been the subject of a foreclosure sale, where the title was transferred to the beneficiary of a mortgage involved in the foreclosure and any properties transferred under a deed in lieu of a foreclosure/sale." Taking the property back at sheriff's sale does not exit the registry.

The Definitions Are Inverted, and That Shifts the Burden

Most ordinances in this series define "vacant" and supply an evidence-of-vacancy list — overgrown vegetation, accumulated mail, no utility usage. Scranton does the opposite. Sec. 360-17 defines "vacant" in a single cross-reference — "Not occupied, as defined in this section." — and puts the entire evidentiary apparatus into the definition of occupied.

That definition opens with a carve-out worth noticing: "unless considered 'abandoned real property' as defined above", a building is occupied where someone "actually conducts a lawful business or resides in all or any part of the building or structure as the legal business-occupant, or as the legal or equitable owner/occupant or tenant on a permanent, non-transient basis", and the evidence that may be offered includes "the regular receipt of delivery of regular mail through the U.S. Postal Service; proof of continual telephone, electric, gas, heating, water and sewer services; trash collection services; a valid City business license; or the most recent federal, state or City income tax statements indicating that the subject property is the official business or residence address of the person or business claiming occupancy; or current written leases indicating current occupancy of the property."

Two consequences follow. The first is practical: the ordinance lists what will prove occupancy rather than what will prove vacancy, so whoever argues a property is occupied will be the party holding the useful documents. The ordinance does not say so — it allocates no burden of proof and creates no presumption of vacancy, and Sec. 360-19F requires the city to show probable cause before it can get a warrant — so treat that as a practical point rather than a legal rule. The second is a genuine contradiction. Because the definition of occupied excludes abandoned real property, and "vacant" is defined as not occupied, an abandoned real property is simultaneously "vacant" by definition. That sits badly against Sec. 360-18D(2)'s reference to a property "occupied but remains in default", and the ordinance does not resolve it.

One more definitional point that widens the scope. Sec. 360-17 defines "structure" as "any building or structure, including commercial and residential, excluding an accessory structure on a property where the primary structure is occupied." So the registry is not residential-only and not commercial-only — unlike Akron or Toledo, Scranton draws no line by use at all.

What the Mortgagee Actually Has to Do

Sec. 360-18D(1) sets the sequence. On default by the mortgagor, the mortgagee "shall perform or have performed an inspection of the property to determine vacancy or occupancy". Within ten days of that inspection it must register with the Bureau of Code Enforcement and indicate whether the property is vacant or occupied. A separate registration is required for each property, "whether it is found to be vacant or occupied."

Then the recurring duty in Sec. 360-18D(2): "if the property is occupied but remains in default, it shall be inspected by the mortgagee or designee monthly until the mortgagor or other party remedies the default, or it is found to be vacant or shows evidence of vacancy at which time it is deemed abandoned, and the mortgagee shall, within 10 days of that inspection, update the property registration to a vacancy status on forms provided by the City."

A monthly inspection of an occupied property is a different operational problem from a monthly check on an empty one, and the ordinance answers the obvious question about scope. It gives the mortgagee no right of entry. Secs. 360-18D(1) and (2) require only "an inspection of the property to determine vacancy or occupancy", and the only interior-entry authority in the article — Sec. 360-19E, and the administrative warrant in Sec. 360-19F — runs to the City rather than to the lender. On an occupied property the monthly duty is satisfied by observation from outside; anything more needs the occupant's consent. What the ordinance does say is that the duty does not pause while the house is lived in.

The registration content in Sec. 360-18D(3) names the servicer explicitly. It requires "the name of the mortgagee and the server, the direct mailing address of the mortgagee and the server, a direct contact name, telephone number, and e-mail address for both parties, the folio or tax number, and the name and 24-hour contact number of the property management company or designee responsible for security and maintenance of the property." The word "server" is printed that way in the codified text, twice; the evident meaning is servicer.

And Sec. 360-18D(6) closes off the usual outsourcing route: "all registration fees must be paid directly by or from the mortgagee, servicer, trustee, or owner. Third-party registration fees are not allowed without the consent of the City and/or its authorized designee." Any vendor-managed registration programme needs the city's consent before it is relied on here.

Fees, Late Fees and Penalties

The late fee is the part that compounds. Ten percent of the annual fee for every thirty-day period "or portion thereof" means a $200 registration that sits unfiled accrues $20 a month, and the phrase "or portion thereof" means a single day into a new period counts as the whole period. Separately, Sec. 360-21A allows a citation carrying up to $300 per instance with each day a separate offense — so the fee arithmetic and the citation arithmetic run in parallel rather than one replacing the other.

One figure this page cannot give you. Sec. 360-19E provides that a property on the registry for over a year "shall be subject to an annual interior health and safety inspection by the Bureau of Code Enforcement or their designee, and shall pay the requisite fee pursuant to Chapter 203." Chapter 203's inspection schedule at Sec. 203-7L is organised by building, plumbing, mechanical and electrical work against construction cost or square footage, with a $41.25 minimum rate, and carries no line item for a health-and-safety inspection of an existing structure. The cross-reference does not resolve to a stated amount in the published code; ask the Bureau what it charges.

The Securing Standard

Sec. 360-19 carries the physical duties and applies to both tracks. Subsection A subjects all vacant and abandoned real properties to all applicable codes. Subsection B requires the owner or designee to "inspect the vacant real property or abandoned real property at least once every calendar month to ensure compliance with all applicable codes" — note that this is a separate provision from Sec. 360-18D(2) and it reaches abandoned real property whether or not anyone is living there, so it keeps running after the occupied-and-in-default duty stops — and do not read it as falling only on the borrower, because Sec. 360-17 defines owner as any party "having any ownership interest, whether legal or equitable", which is wide enough to argue a mortgagee into it. Subsection C requires securing "such that the property is not accessible to unauthorized persons".

"Accessible to unauthorized persons" is defined in Sec. 360-17 as "a property that is accessible through a compromised/breached gate, fence, wall, or other enclosure, or a structure that is unsecured and/or breached in such a way as to allow access to the interior space by unauthorized persons." The perimeter counts, not only the building — a breached fence puts the property in violation even if the structure itself is sound.

The plywood specification in Sec. 360-19D is stated by opening type, and it is the detail most likely to be missed when pricing a board-up: "plywood used to secure a vacant real property or abandoned real property shall be of unsanded CDX grade and shall have a minimum thickness of one-half inch for window openings, five-eighths inch for door openings, and three-quarters inch for sliding door and French door openings." Half-inch stock across the whole building does not meet it.

Two separate entry powers sit in Sec. 360-19, and they have different predicates. Sec. 360-19E carries its own: beyond the annual inspection, "as reasonably necessary to protect the health, safety, and welfare", the Bureau or its designee "may perform an interior health and safety inspection upon a vacant real property or abandoned real property." Sec. 360-19F is the harder route — a court-issued administrative warrant, "upon a showing of probable cause of a violation of this article". The city has a way inside either way.

The Process Gap

This is the finding that should shape how a servicer handles Scranton, and it is a negative one. Secs. 360-17 to 360-21 contain no notice provision, no hearing provision and no appeal provision. Nothing in the article requires the city to tell anyone before a registration obligation, a fee, a late fee or a compliance-work lien attaches, and nothing creates a right to contest a vacancy or abandonment determination. Enforcement runs by citation under Sec. 360-21A.

Mortgagees get no notice right at all under Article III. The ordinance casts them as the duty-holder rather than as a party to be notified, which is a materially different posture from the Ohio and Louisiana cities in this series, several of which serve every interest shown in the land records before a hearing.

Notice and appeal exist only on the general code-enforcement side. Scranton adopts the International Property Maintenance Code at Sec. 360-1 and amends its service provision at Sec. 360-2 to add service "by first-class mail addressed to the owner at the last known address" and by posting "in a conspicuous place on or about the structure", with the amendment stating that "service by this method upon the owner's agent or upon the person responsible for the structure shall constitute service of notice upon the owner." Posting is one of the listed methods, and the amendment adds that service by that method on the owner's agent or on the person responsible for the structure counts as service on the owner. The amended list runs to the owner, the owner's agent and the person responsible — there is no mortgagee-of-record notice anywhere in it.

The appeal route runs to the Housing Board of Appeals and is governed by Sec. 203-15B, whose own grant runs to a person aggrieved by a decision of the Director/BCO: ten days from the date of decision, a nonrefundable $300 filing fee, notification to appear within thirty days, and a further appeal to the Court of Common Pleas of Lackawanna County within thirty days of the board's decision being filed. A demolition order gets twenty days rather than ten.

The drafting is untidy on who may use that route, though less closed than it first looks. Sec. 203-15B grants its own right to "any applicant or licensed contractor aggrieved by any decisions of the Director/BCO", which does not obviously describe a mortgagee contesting an abandonment designation. But the amended code provision confers the appeal in its own words — the Housing Board of Appeals "shall hear and decide appeals of orders, decisions or determinations made by the code official" — and borrows from Sec. 203-15B only its "timelines, fees, requirements, and other provisions". Sec. 203-15B itself then refers to "any person making an appeal to the Board". The appeal is probably available; the wording is worth raising with counsel rather than treated as a bar.

Exemptions, and Whether They Reach the Lender Track

Sec. 360-18E(3) exempts three categories from the annual fee: properties with an active permit under Chapter 203; occupied properties with an active rental licence under Chapter 373; and properties that change status mid-year between rental licensing and vacancy registration. Sec. 360-18E(4) goes further and says the article "shall not apply to" properties owned by a government entity "including but not limited to any land bank or municipal authority", properties listed on the Lackawanna Tax Claim Bureau's repository for unsold property, and "multi-unit structures of two to four units in which one unit is owner-occupied and actually occupied."

Whether any of that reaches the mortgagee track is genuinely unclear. Both provisions sit under subsection E, which is headed "Vacant real property", and E(3) is expressly limited to vacant real property — but E(4) says "this article", which on its face is wider. Subsection D, the abandoned track, states no exemptions of its own at all: no carve-out for active marketing, active rehabilitation, estates, or lender-owned inventory. A servicer should not assume the owner-occupied duplex carve-out protects it from the $200 registration.

One further duty catches multi-unit owners. Sec. 360-18E(5) requires an owner of a multi-unit structure constituting a residential rental property, where no other notification duty already applies, to notify the Bureau of Code Enforcement of each vacant unit within it — with no fee for that notification. "Vacant unit" is defined in Sec. 360-17 as a dwelling unit that "would constitute a vacant real property if that unit were itself a structure."

Liens, and What Pennsylvania Law Does and Does Not Say

Sec. 360-21B is the whole of the cost-recovery provision: on a determination that a property is in violation, "the City may take the necessary action to ensure compliance with and place a lien on the property for the cost of the work performed to benefit the property and bring it into compliance." Read that narrowly, because it is drafted narrowly. The lien covers the cost of work the city performs. It does not purport to lien unpaid registration fees or late fees, and Article III gives those no stated collection mechanism beyond citation.

Article III creates no personal liability for the cost of that compliance work — Sec. 360-21B reaches the property only — and it cites no statute and claims no priority. It does impose personal obligations elsewhere: Sec. 360-18D(6) makes the registration fee payable by the mortgagee, servicer, trustee or owner, Sec. 360-18D(7) makes the late fee "due and payable with the registration", and Sec. 360-21A makes "any person" who violates the article liable on conviction for a fine. The nearest express municipal-lien hook sits in the adopted maintenance code, where Sec. 360-2 provides for emergency repair costs and allows the city to recover them "including imposing a municipal lien on the subject real estate for the costs thereof in accordance with Pennsylvania law and the Code of the City of Scranton", again without citing a section.

Pennsylvania's priority rule lives in the Municipal Claim and Tax Lien Law, the Act of May 16, 1923, P.L. 207, No. 153. Section 3(a)(1) provides that municipal claims and municipal liens "shall arise when lawfully imposed and assessed and shall have priority to and be fully paid and satisfied out of the proceeds of any judicial sale of said property, before any other obligation, judgment, claim, lien, or estate with which the said property may become charged, or for which it may become liable, save and except only the costs of the sale and of the writ upon which it is made, and the taxes, tax claims and tax liens imposed or assessed upon said property."

Section 31 of the same act then addresses the prior mortgage directly, and it is the provision a lender most needs: mortgages and other charges "which were recorded, or created where recording is not required, before any tax other than for the current year accrue, or before the actual doing of the work in front of or upon the particular property for which the municipal claim is filed, shall not be disturbed by such sale unless a prior lien is also discharged thereby." A mortgage recorded before the city did the work is therefore not divested by a sale on that municipal claim. The same section sets the distribution order: on such a sale "all tax claims shall be paid out of the proceeds thereof: first, the oldest tax having priority; and municipal claims shall be paid next, the oldest in point of lien having priority." How that interacts with a prior tax lien on the same title is a question for counsel.

Act 90 Carves Out Mortgage Lenders, and REO Does Not End That

Pennsylvania's Neighborhood Blight Reclamation and Revitalization Act, 53 Pa.C.S. Sec. 6101 et seq., is the statute people reach for when they want to know whether a municipality can come after an out-of-state owner personally. Scranton invokes it at Sec. 445-74C(3)(c), directing the Zoning Officer to "deny any permit authorized by this chapter to any applicant to whom a permit may be denied pursuant to the Neighborhood Blight Reclamation and Revitalization Act". Permit denial is the one limb where the carve-out should not be assumed: Sec. 6131(a)(1) lets a municipality deny a permit to "an applicant" where "the applicant owns" real property carrying a delinquency or a serious violation, and "applicant" is undefined while the gating condition is the verb rather than the defined noun. Two safeguards apply either way: Sec. 6131(a)(2) bars denial where "the municipal permit is necessary to correct a violation of State law or a code", and Sec. 6131(b)(2) deems the property compliant if the municipality does not respond within 45 days.

But read the definition. Sec. 6103 defines "owner" as "a holder of the title to residential, commercial or industrial real estate, other than a mortgage lender, who possesses and controls the real estate", adding that the term "includes, but is not limited to, heirs, assigns, beneficiaries and lessees, provided this ownership interest is a matter of public record." A mortgage lender is expressly carved out, and Sec. 6111's in personam action and Sec. 6112's asset attachment both operate on "the owner", so the carve-out carries into both. Two limits deserve counsel's attention: the exclusion reaches only entities qualifying as a banking institution or mortgage lender under 7 Pa.C.S. Ch. 61, so an unlicensed servicer, a securitisation trust or an REO subsidiary may fall outside it, and title must be held in enforcement of the mortgage, so a property bought from a third party is not covered.

The carve-out is not lost at REO, which is the opposite of what intuition suggests. Sec. 6103 defines "mortgage lender" as a business association qualifying as a banking institution or mortgage lender under 7 Pa.C.S. Ch. 61 "that is in possession of or holds title to real property pursuant to, in enforcement of or to protect rights arising under a mortgage, mortgage note, deed of trust or other transaction that created a security interest in the real property." Holding title taken at your own foreclosure sale is precisely the posture that definition describes, so the exclusion is at its strongest there rather than extinguished.

The Condemned-Property Trap

One provision outside the registry is worth knowing before buying distressed Scranton stock. Chapter 359 conditions the right to work on a condemned property in two stages. Sec. 359-2 requires the owner to file a notarised affidavit with, among other attachments, a county tax certificate and a City treasurer certificate evidencing that City real estate taxes and refuse fees are paid in full. Sec. 359-3A then adds a separate duty before the work starts: secure a performance bond or cashier's check acceptable to the City to cover demolition costs.

The duty falls on the owner, so it bites once you take title rather than while you hold the mortgage — and at that point clearing the previous owner's tax and refuse delinquency becomes a precondition to doing any work on the building. Note the collision with Sec. 360-19C, which requires the property to be secured regardless. It is unusual enough to be worth checking against whichever other Pennsylvania municipality your file sits in.

Scranton also handles blight separately from the registry. Chapter 18, Article VI establishes a Blighted Property Review Committee "pursuant to the Urban Redevelopment Law (35 P.S. Sec. 1701 et seq.)", amended in its entirety on July 22, 2025 by Ordinance No. 86-2025. Certification runs to the Redevelopment Authority rather than into the vacancy registry, so a property can be on one track without being on the other.

What This Means for a Scranton File

• Wire the $200 track to the default date, not to a vacancy report. The duty begins on default by the mortgagor, with an inspection and then ten days to register.
• Expect to register occupied properties. The definition says "whether vacant or occupied", and Sec. 360-18D(1) requires a separate registration either way.
• Calendar the monthly re-inspection while a defaulted property stays occupied, and the ten-day update if it becomes vacant.
• Check whether your registration vendor is permitted here. Sec. 360-18D(6) requires fees to come directly from the mortgagee, servicer, trustee or owner absent the city's consent.
• Diary March 15 for renewals, and 10 days for reporting any change in registration information under Sec. 360-18C.
• Specify plywood by opening type: half-inch windows, five-eighths doors, three-quarters sliding and French doors, all unsanded CDX.
• Do not rely on the owner-occupied duplex or land bank carve-outs on the lender track. They sit under the vacant-property subsection and subsection D states no exemptions at all.
• Diary the ten-day appeal window even though Article III creates no appeal of its own. The right comes from the amended code provision rather than from Sec. 203-15B's narrower wording, and the clock and the $300 fee come from Sec. 203-15B.

Pennsylvania's three markets in this series now read as three models. Philadelphia licenses the vacant property. Pittsburgh registers the vacant building. Scranton does both of those cheaply and then runs a second, more expensive registry off the loan file. For a servicer the Scranton obligation is closer to the general preservation duties that arrive through investor guidelines than to a municipal vacancy filing — except that this one is enforceable by the city by citation, at up to $300 per day on conviction.

Ethreon runs vacant property inspections, securing and board-up work across Scranton. On a Scranton file the inspection is the obligation, not just the evidence — monthly, on both tracks, and on occupied property while a default runs.