Neighbor Planning to Strip Home Before Foreclosure - My Rights/Responsibilities? (Plano: appointed, short sales)

[loves2read]

some of the people forced into foreclosure were frankly lied to by their mortgage holders and tricked into getting further into arrears on their mortgages so they basically had no choice but foreclosure--which is what the mortgage company wanted in the first place--

SOME homeowners in these situations have had dramatic changes in their lives--major illness/medical debts often with loss of medical insurance coverage, job loss and long time unemployment that drained savings (even 401Ks in some instances)--
these people can't be help to the same standards of accountability if they bought a home that was a viable choice before their problems

someone who lied or was encouraged to lie on mortgage applications (and many did) and then had their mortgage adjusted and saw a decrease in equity and could not refinance at lower rate because the value of the home was lower than original purchase--
those people I don't have much sympathy for--
some of them WERE tricked/gulled/lulled by mortgage brokers into making bad decisions and many of them lack any money sense--
they just wanted a house and better lifestyle they thought would come with it because they wanted the American Dream for them and often for their children...

I have NO sympathy for the banks/wall street gurus/finance companies/appraisers/developers who were hand-in-glove complicit in this mega scheme to defraud--
and that is exactly what it was--
don't get me started--Angelo Mozillo was fined what was reported half of his fortune but since 85% of it was obtained illegally--I think ALL of it should have been seized plus all his assets and he should have gone to jail just like Bernie Madoff

[skids929]

Originally Posted by loves2read

some of the people forced into foreclosure were frankly lied to by their mortgage holders and tricked into getting further into arrears on their mortgages so they basically had no choice but foreclosure--which is what the mortgage company wanted in the first place--

SOME homeowners in these situations have had dramatic changes in their lives--major illness/medical debts often with loss of medical insurance coverage, job loss and long time unemployment that drained savings (even 401Ks in some instances)--
these people can't be help to the same standards of accountability if they bought a home that was a viable choice before their problems

someone who lied or was encouraged to lie on mortgage applications (and many did) and then had their mortgage adjusted and saw a decrease in equity and could not refinance at lower rate because the value of the home was lower than original purchase--
those people I don't have much sympathy for--
some of them WERE tricked/gulled/lulled by mortgage brokers into making bad decisions and many of them lack any money sense--
they just wanted a house and better lifestyle they thought would come with it because they wanted the American Dream for them and often for their children...

I have NO sympathy for the banks/wall street gurus/finance companies/appraisers/developers who were hand-in-glove complicit in this mega scheme to defraud--
and that is exactly what it was--
don't get me started--Angelo Mozillo was fined what was reported half of his fortune but since 85% of it was obtained illegally--I think ALL of it should have been seized plus all his assets and he should have gone to jail just like Bernie Madoff

I agree..It's easy to blame people alone for not living into a commitment, but the banks we just plain old stupid in all of this. Although, there are alot of scenarios where people made say $20k a year and for some reason thought they could afford a $300k home using a fancy mortgage tool that was never meant for them. The whole industry is broken and disjointed, if you aren't your own personal finance expert I can see people getting sucked in easily by the allure of home they think they deserve.

Either way , it's a whole new world, and one thing this crash has proven in spades is that you NEED to save your $$ regardless of what the government says about spending etc to keep the economy going.

[Big G]

Originally Posted by MurphyPl1

Big G, provided you can even find the right person at the bank to notify, they won't care. They are in over their heads right now and can barely manage to keep up with knowing that they own a property. And chances are the office handling the foreclosure isn't even local.

...

I get wanting to do something, but the banks are useless.

That seems to be the consensus on here. It's like watching a train wreck about to happen, but not being able to do anything about it.

Those scenarios from your neighborhood are scary - and exactly what I want to avoid for my neighborhood. We had a non-gutted foreclosure a couple of years back that was bad enough - empty house for months, weeds and foot-high grass, pool turned into swamp, bank breaking in to secure house, etc.

Going forward, it sounds like my only useful course of action is to engage the neighbor and try to convince him to at least leave the plumbing and mechanicals. It appears that hauling away the window coverings and appliances is SOP for those being foreclosed on. But, as an early poster on here said, some people prefer a blank slate for those anyway.

---

Tangentially related to this:

The neighbor plans to walk long before the house goes into foreclosure. Is there any way to encourage my neighbor to accelerate that process? That is, can he call up his bank and tell them, "I'm gone, here are the keys, and the house is yours - today"?

[galore]

Why dance around this subject with your neighbor?
Instead of snitching just tell him upfront that his plans are unethical and possibly illegal. He doesn't sound like friend material anyways.

[Big G]

Originally Posted by galore

Why dance around this subject with your neighbor?
Instead of snitching just tell him upfront that his plans are unethical and possibly illegal. He doesn't sound like friend material anyways.

I doubt we'll be keeping in touch, since having no forwarding address seems to be a key component of his future financial plans.

I don't think any argument about this being unethical will get much traction. After all, as many posters have pointed out, the entire concept of walking away from a mortgage is highly unethical. Is ripping out the bathroom toilets that much MORE unethical?

In his mind, everything about this situation is someone else's fault. "They" did this to him, so he feels justified in any negative actions.

IMO, I'll get more mileage working the "innocent bystander" angle, pointing out the collateral damage we in the neighborhood will suffer if the bank can't move the house.

[lh_newbie]

Originally Posted by Big G

IMO, I'll get more mileage working the "innocent bystander" angle, pointing out the collateral damage we in the neighborhood will suffer if the bank can't move the house.

I fully agree - and would encourage you to mention the cash for keys programs. He can take his appliances and still qualify. After all, appliances are where the money is. Fridge, washer/dryer, window coverings - those things are worth real money and can be used in a rental. Toilets... not so much. And not much in the way of resale. I'd think that $1000 from the bank for a cash-for-keys program would be WAY better then trying to sell small items from the home and way better for the neighborhood.

Brian

[Debsi]

Walking away is not unethical - it's part of the mortgage contract that if you don't pay, the bank takes back the collateral. Walking away when you can afford to pay is arguable, as lower property values caused by foreclosures hurt everybody in the neighborhood (except those who don't want to sell and get lower property taxes because of it)

Stripping a house IS highly unethical. It is much worse. There should be a huge extra credit score ding on people that do this, would you want to ever lend somebody like this money? Your neighbor has some serious entitlement issues. The house is supposed to be returned in livable condition - the appliances and fixtures and light switch plates are attached, and therefore part of the house. I remember reading last year that Fannie Mae and Freddie Mac had put out guidelines that they want servicers to let them know about people that intentionally gut homes and do buy and bails, but I'm not sure how they were actually planning to go about collecting that information. Not to mention it is very difficult to prove, as somebody could have come in after the foreclosure sale and stripped the house. I can only assume Fannie and Freddie want the information so they will never allow mortgages to such people again, or perhaps they are planning to start really going after people legally in a way not done in the past.

[Debsi]

Originally Posted by lh_newbie

I fully agree - and would encourage you to mention the cash for keys programs. He can take his appliances and still qualify. After all, appliances are where the money is. Fridge, washer/dryer, window coverings - those things are worth real money and can be used in a rental. Toilets... not so much. And not much in the way of resale. I'd think that $1000 from the bank for a cash-for-keys program would be WAY better then trying to sell small items from the home and way better for the neighborhood.

Brian

Cash for keys comes with a walk-through final inspection. They can't sell the appliances. Window coverings I'm not sure about.

[Big G]

Originally Posted by Debsi

...(except those who don't want to sell and get lower property taxes because of it)...

Hey! I found my silver lining!

[loves2read]

There should be a huge extra credit score ding on people that do this
I would think this guy is going to get that anyway and probably has suffered some of it already