Trashing of soon to be foreclosed homes

[Keitht]

When people borrow more than they can afford it's rare for it to be a black and white case of where the blame lies. In the vast majority of cases the blame must be shared. The borrower should know their realistic limits and the lender must ensure that the borrower can actually afford the loan.
A friend of mine wanted to borrow 7.5k and the bank actually pushed him hard to take 10k. Their suggestion was to use the remainder for a nice holiday. Fortunately my friend stuck to his guns and only took out the lower value loan. I'm sure many others wouldn't have been as careful.

 

[Twinkstarr]

Apparently, this has become a huge problem. Frustrated owner's being forceclosed are trashing homes, removing applicances, etc.

We live in a middle class neighborhood in Florida. This week I learned about a home that was completely trashed here. It probably sold for about $400,000 a year ago. This was a very nice home with a swimming pool on a water view and a good neighborhood.

The owner's used a hammer on each and every wall punching holes in the drywall. Spread feces on the walls and carpeting. Destroyed cabinets and all the plumbing fixtures. Tore out shrubbery and threw it in the pool and destroyed the pool equipment. I'm told the damages probably were about $100,000.

The shocking thing is they haven't appeared to break any Florida laws, so they aren't responsible for the damages, and will probably get some kind of tax relief for the mortgage balance difference.

Somethings very wrong with this picture, huh?

We looked at a house in foreclosure about 3yrs ago. This was in a gated community with $500,000+ homes. A combination of divorce and personal gurarantees for business loans caused the foreclosure.

I couldn't believe what I saw or smelled. They apparently let the cat pee all over. Cracked the marble in the front hall(looked like they threw things off the open staircase from 2nd floor. Let the ice melt in the Sub zero and it ruined the hardwood floor in the kitchen. Quite a few holes in the walls.

My Dad, who had been a builder when I was a kid, had told me about what happens to houses that get foreclosed and I had a friend in that worked in that department for one of our local banks tell me the exact samething.

Trashing a house you are about to be kicked out of is not new, unfortunately.

 

[Wonka]

Yes, I'm well aware house trashing isn't "new". However, the numbers have increased dramatically with the current economic situation and I don't think it was as common in nicer, middle/upper middle income neighborhoods.

Nobody should be excused from this kind of behavior. Nobody. It doesn't make any difference if you were dumb and borrowed more than you can afford, whether the lender "enticed" you to borrow more than you could afford, or if a medical or other situation caused the foreclosure.

My belief is a homeowner intentionally destroying property reducing the value to a creditor who has an interest should be criminal. Period. I think this might be the case in CA. Does anyone know?

 

[Twinkstarr]

Yes, I'm well aware house trashing isn't "new". However, the numbers have increased dramatically with the current economic situation and I don't think it was as common in nicer, middle/upper middle income neighborhoods.

Nobody should be excused from this kind of behavior. Nobody. It doesn't make any difference if you were dumb and borrowed more than you can afford, whether the lender "enticed" you to borrow more than you could afford, or if a medical or other situation caused the foreclosure.

My belief is a homeowner intentionally destroying property reducing the value to a creditor who has an interest should be criminal. Period. I think this might be the case in CA. Does anyone know?

I read an article in the WSJ about a year ago about companies that banks hire to "watch" foreclosed homes. This is more making sure they are not broken into after the foreclosure. I think the problem is now especially in parts of CA there are just too many foreclosed homes to keep an eye on and I think the banks use these services on homes of X value and above.

I don't think they are destroying the property to reduce the value, but out of believing it's the banks fault that they lost their home. So they'll show them.

We live in a upper middle class suburb and have seen our fair share of this activity in the last few years also. In our neighborhood, we've had 2 and DH and a few other of the guys kept the lawns mowed, driveways cleared in winter so the house doesn't look empty.

 

[Wonka]

I don't think they are destroying the property to reduce the value, but out of believing it's the banks fault that they lost their home. So they'll show them.

Of course, but don't you think folks trashing houses and doing $100,000 of damage realize what they're doing to the value of the home?

 

[pianodinosaur]

This subject may be bordering on political. I worked hard for my house and my car. I had to save up for years to make a down payment. Thanks to various shake down artists, banks were forced to give home loans to illegal aliens, criminals, and people who never worked a day in their life. Then we are supposed to be surprised when they default on the loan and trash the property. This is the reason why so many employers are getting credit reports prior to hiring a new employee. If they flunk the credit report, they don't get hired. It is a reflection on character.

 

[pittle]

We recently purchased a foreclosed/REO home. The former owners took all the appliances, faucets, light fixtures and ceiling fans. We saw another one that they took all the door handles and toilets too! The one we purchased also had lots of drawings with marker pens on the walls and carpets done by their children. We saw the neighbors across the street take all their appliances when they moved too. I can understand taking a washer/dryer and refrigerator, but built-in cooktop, double oven, microwave and dishwasher are pretty strange to me.

On the upside - we got a great house for about 1/2 the price that the original owners paid and are happy with it. It is a much larger and nicer house than we ever imagined having and now that everything is new it is great. This house is barely 2 years old. We got it for less than $80 square foot on a 1/2 acre lot in a really nice neighborhood.

 

[SmileCathy]

This sounds like the best solution.

 

[pranas]

I read an article in the WSJ about a year ago about companies that banks hire to "watch" foreclosed homes. This is more making sure they are not broken into after the foreclosure. I think the problem is now especially in parts of CA there are just too many foreclosed homes to keep an eye on and I think the banks use these services on homes of X value and above.

I don't think they are destroying the property to reduce the value, but out of believing it's the banks fault that they lost their home. So they'll show them.

We live in a upper middle class suburb and have seen our fair share of this activity in the last few years also. In our neighborhood, we've had 2 and DH and a few other of the guys kept the lawns mowed, driveways cleared in winter so the house doesn't look empty.

In my town, homeless people try to move in once the foreclosed home is vacated. The police are constantly on the look out for this. My neighborhod is considered an affluent area but it is a beachside community.

 

[JeffW]

As a fallback, good ethics and honest should prevent homeowners from doing this. However, apparently there doesn't seem to be many (if any) laws to prevent it, and in the absense of rules, a lot of anarchy can come about.

Also, from the bank/mortgage company perspective, they probably effectively reduced their losses much more by getting the gov't bailout passed (maybe in part by crying wolf), then by any amount of security, civil suits, etc going against destructive homeowners. To the bean counters, they are probably losing so much already on the foreclosure that the extra house damage, while in principle disgusting, really isn't costing them that much extra money.