Tales from the Trenches: Foreclosures

Sometimes we inspect homes that have gone through the foreclosure process for our clients.  They often have ideas about flipping the house or using the property as a rental, and want us to look it over so they know where to begin in rehabbing the home.

forclosure

It is amazing what some of the previous owners will do to “pay back” the bank for foreclosing the property. The term for this is called malicious foreclosure stripping, and it is the intentional damage and removal of fixtures and fittings from the property. It is done in an attempt for the owners to salvage some of their investment, however, it also is done to significantly decrease the home’s value and cause resale to be nearly impossible.

Foreclosure stripping has been a growing trend in recent years. In neighborhoods where this occurs, it can cause a devaluation of the other property in the area because it’s sale value will be included in the appraisal comparisons.  Foreclosure stripping is also a problem for banks, as mortgages are unavailable on incomplete properties, meaning that for resale to occur, a cash buyer is necessary.

Foreclosure stripping is considered a crime in most states and goes against the details of the foreclosure deed signed by the home owner. Repairing the vandalism can be a huge added expense to the purchasers of the destressed property, and sometimes clients will walk away from the deal because it is too much of a headache to fix.  It is common to find holes in walls, carpet shredded, wood flooring damaged.  Toilets removed or clogged, damaged or missing doors, missing or damaged plumbing, hot water heater damaged or missing, the list is endless. One of the most shocking thing we’ve found in one of these homes was a collection of dead chickens, their eggs, and the remains of a deceased turtle in the attic.

Items that must legally remain in the foreclosed home are:

– Built-in Appliances (dishwashers, microwaves, stoves)

– Cabinets, Shelving, and Countertops,

– Built-in Heating and Cooling Equipment

– Plumbing and Copper Pipes

– Electrical Wiring and Fixtures (including outlets, lighting, and ceiling fans)

– Doors and Associated Hardware

– Flooring (Tile, Carpet, and Decking)

– Windows and Vents

– Sinks, Tubs, Toilets, Showers, and Associated Hardware

– Landscaping and Fencing

– Built-in Pools and Spas

If you are thinking of buying a destressed property, a professional home inspection can help you figure out what your big ticket repair items will be.  Give us a call today!

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