"Nice Home. Where’s the Rest of It?" NY Times House Stripping Article Covers Phoenix Area (Surprise: real estate, foreclosures)

[azjack]

"Even in Arizona, which has an applicable law and where thousands of homes have been stripped, convictions are rare. There, to make a charge stick, law enforcement basically has to catch people in the act, said Julie Halferty, a special agent with the F.B.I. in Phoenix and head of a mortgage fraud task force."

"In Maricopa, a distant Phoenix suburb that had rapid growth before the crash, new developments were stripped one after another, often in the order they were built, according to Shawn Schlegel, a real estate broker who publishes a weekly community newspaper.
“The same way they built the city is the same way the city got stripped out,” Mr. Schlegel said. “It’s gone through every neighborhood.”

http://www.nytimes.com/2009/12/23/bu...3stripped.html


Check out the slideshow:

Foreclosure, Then a Shell - The New York Times > Business > Slide Show > Slide 1 of 8

[fcorrales80]

From the article:

"If that seems like a situation tailor-made for the police, it is — at least in Arizona, where the Federal Bureau of Investigation has used Craigslist to arrest a handful of people for stripping homes and trying to sell the goods, charging them with felonies under a state fraud statute.

In other parts of the country, however, the police are stymied. As it turns out, several troubled states, like Nevada, have no specific criminal prohibition against stripping fixtures from a property before foreclosure. Mortgage contracts do prohibit such behavior, requiring that homes be kept in good order. But violating those provisions is a civil matter, not a criminal offense.

“If the homeowner sells the components to the house while they still own the house, that’s not a crime,” said Officer Bill Cassell, a spokesman for the Las Vegas police.

So too in Florida, another state swamped by foreclosures. Several prosecutors and police agencies there said that unless laws were modified, such behavior would have to be sorted out between borrower and lender in civil court. "

Arizona is the only state that has a weapon to combat the problem unlike Nevada and Florida; still this sucks for those homes owned by banks where owners were foreclosed on and decided to strip them. There was a house in my parent's neighborhood that was stripped. The person leaving was "bitter" the bank didn't seem to want to work with them. When it sold the new buyer got a deal and incentives to buy and install missing cabinets and features. My parent's do believe the people that stripped the house were arrested for fraud...

[azjack]

The article mentions the sting on the one guy in Surprise who had advertised on Craigslist, but there have been few arrests and even fewer convictions.

I was in this one house in Surprise a year or two ago that was missing the kitchen. Everything - appliances, cabinets, counters, the island, and yes, the kitchen sink. That house, which used to be a model (so lots of premium upgrades) was also missing the stair rail, all bathroom sinks and toilets, water heater, air-conditioner units, and the guy wrote about his disdain for the builder/lender on the walls. I can only imagine what he did to the swimming pool machinery. If I can find the digital photos sometime, I will post them.

[ArizonaBear]

My G/F's house; prior to her buying it had its rooftop AC unit taken...........I am 99% the previous owners lost the place to foreclosure-------she bought it for 40 cents on the dollar. It dropped over $100K in value from its peak of $220K back in 2007.

[cmist]

Sounds like a gray area to me... how can a bank say you don't own the items you removed? What percentage of the home is owned due to the down payment and previous payments you made?

Hypothetically speaking, if I was building a 2nd home up north and was planning on moving to it and wanted to use my fancy appliances and fixtures up north, and planned on refitting the home down here with cheapo apt style things and selling it, but then I lose my job and can't afford to replace them and have to return it to the bank, what law says anyone has to provide any standard of a home when giving it back to the bank?

If a person can remove cabinets, plumbing fixtures, appliances, toilets, vanities etc. and use them in a new place, how can a bank say they aren't entitled to that? I understand that when you outright sabotage a home, there is probably some law on the books about vandalism, but I don't know how a bank has claim to items that are removable, considering most loans had large down payments or extortionate interest that paid for the removed items many times over.

[fcorrales80]

Originally Posted by cmist

Sounds like a gray area to me... how can a bank say you don't own the items you removed? What percentage of the home is owned due to the down payment and previous payments you made?

Hypothetically speaking, if I was building a 2nd home up north and was planning on moving to it and wanted to use my fancy appliances and fixtures up north, and planned on refitting the home down here with cheapo apt style things and selling it, but then I lose my job and can't afford to replace them and have to return it to the bank, what law says anyone has to provide any standard of a home when giving it back to the bank?

If a person can remove cabinets, plumbing fixtures, appliances, toilets, vanities etc. and use them in a new place, how can a bank say they aren't entitled to that? I understand that when you outright sabotage a home, there is probably some law on the books about vandalism, but I don't know how a bank has claim to items that are removable, considering most loans had large down payments or extortionate interest that paid for the removed items many times over.

I think a foreclosure works a little differently and they aren't talking about appliances in general, but taking wiring, tubs, fixtures, etc that CAME with the house and are a part of the structure. Arizona is the only state wth laws against such fraud and the investigations are heating up here; unlike other states that have NO remedy. While there have been few "convictions" there have been plenty of civil action in which those that stripped homes have lost even more money to replace what they stole.

[azjack]

It is not an ethical move to be sure, but people posted stuff like almost new water heaters, built-in ovens, cabinets, AC units quite a bit on PHX Craigslist. They publicized the Surprise Craigslist sting, so the postings are less blatant now. Of course, houses can also be stripped while vacant by strangers, pre and post foreclosure.

The FBI's big catch in Surprise pleaded guilty, received no jail, and will have the charge reduced from a felony to a misdemeanor if he stays out of trouble.

[fcorrales80]

Originally Posted by azjack

It is not an ethical move to be sure, but people posted stuff like almost new water heaters, built-in ovens, cabinets, AC units quite a bit on PHX Craigslist. They publicized the Surprise Craigslist sting, so the postings are less blatant now. Of course, houses can also be stripped while vacant by strangers, pre and post foreclosure.

The FBI's big catch in Surprise pleaded guilty, received no jail, and will have the charge reduced from a felony to a misdemeanor if he stays out of trouble.

Not ethical at all; the FBI's big catch in Surprise now owes huge dollars for restitution to the "victim" of his crime as well...

[azjack]

"the FBI's big catch in Surprise now owes huge dollars for restitution to the "victim" of his crime as well... "

???

"Mr. Guzman pleaded guilty to defrauding a secured creditor, a felony. If he completes 18 months of probation, the charge will be reduced to a misdemeanor, he will serve no jail time and pay only a few hundred dollars in court fees."

[fcorrales80]

Originally Posted by azjack

???

"Mr. Guzman pleaded guilty to defrauding a secured creditor, a felony. If he completes 18 months of probation, the charge will be reduced to a misdemeanor, he will serve no jail time and pay only a few hundred dollars in court fees."

That is the "criminal case." Civil charges and restitution can still be filed...or restitution sought in accordance with the criminal proceedings...