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Caught In The Middle Of The Foreclosure Mess


Can You Imagine?

Imagine working with folks to help them find a home.  You’ve spent weeks with them as you’ve helped them navigate their marketplace, got them a great deal on a home that was headed for foreclosure, and even introduced them to one of your preferred local lenders who worked out their financing.  In May, you walked away from the closing table with them after they had closed on their first home, all smiles and laughs.  They were ready to move in and all was right with the world … makes you feel really good about being in such a great industry.

Now imagine the feeling you’d have in the pit of your stomach as you listen to their frantic voicemails as they described coming home just a few days later to find their belongings gone.  Their clothes, their furniture, the food in their pantry, even their daughter’s piggybank … gone.  It’s hard to imagine, isn’t it?  Can’t be a true story, right?

Where’s The Stuff?

Unfortunately, it’s all true.  The Dickson’s returned home from work just SEVEN DAYS after closing on their first home, located in Cedar Park TX, to find everything in their home gone.  The locks had been drilled open, and they assumed everything had been stolen so they filed a police report, only to find out that everything had been “legally” removed from the home.  Seems that the house, which was about to be foreclosed on when the Dickson’s put a contract on it, continued through the foreclosure process unimpeded, and the lender – EMC Mortgage Corporation – screwed it up.  They flat out screwed it up, and the Dickson’s were caught in the middle.  The items were removed by a property management company and donated to local thrift stores … I’m sure you’re not surprised to learn that the family has been unable to find ANY of their possessions.

How To Stop The Wheels Of Motion?

The lender has admitted fault, but – to the best of my knowledge – has not extended the olive branch beyond that.  So, the Dickson’s have filed suit for EMC’s failure to return any of their property.  On face value, it seems the property management group was just doing what they were hired to do – remove the items left in a home that was legally being foreclosed on.  The story speaks to a larger problem though, of an industry that’s been running rampant for years with few checks and balances.  Any agent who’s worked with REO properties has story after story of little-to-no communication from the banks, long delay periods and offers sitting at the banks for weeks at a time – have lenders become so bogged down in foreclosures that the wheels are coming completely off?  NOT putting the home through the foreclosure process would have saved EMC far more money than it’s going to cost them, now that there’s a suit on the table.  I don’t know how the Dickson’s can place a value on their family possessions – family pictures, childhood memories, perhaps personal effects from their native Nigeria – but I feel for them.  I can’t imagine the shock, anger and then sadness that they’ve got to be feeling.

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It’s Our Problem

Major lenders being bought out or simply going out of business, news of insolvency among Freddie and Fannie (whether true or not), suits by states against financial institutions, now lenders foreclosing on the wrong homeowners … it’s a sad state of affairs we’re seeing and we ALL have an opportunity to make it right.  It’s not a THEM problem, it’s an US problem. I have no doubt that readers here are working to make their marketplaces better, but there’s still work to do.  In the meantime …

If you’re so moved to donate housing items, clothing, etc. to the Dickson family, you can do so by sending it to:

Bobo and Joy Dickson
9800 N. Lamar Blvd.
No. 315
Austin TX 78753

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Written By

Writer for national real estate opinion column AgentGenius.com, focusing on the improvement of the real estate industry by educating peers about technology, real estate legislation, ethics, practices and brokerage with the end result being that consumers have a better experience.

53 Comments

53 Comments

  1. Michelle DeRepentigny

    July 11, 2008 at 8:37 am

    This post gave me chills. I actually am surprised that this doesn’t happen more often. I have a house listed now that was rekeyed by the asset management company 6 days before a foreclosure sale had been scheduled – thankfully it was vacant, but they did rekey where it could not be shown and “stole” my $99.00 lockbox. The house was put under contract and removed from the foreclosure sale, but no one notified the asset management company. The lines of communication are definitely broken – the good news we hope to close in 2 weeks.

    My heart aches for the family in this situation, they must be heartbroken at the loss of their belongings.

  2. Robert D. Ashby

    July 11, 2008 at 8:38 am

    I am glad to see stories like these getting around as unsuspecting homeowners need to know what could happen. It is shameful that our industry has gotten to this level, though the government tends to “overcontrol” when they get involved.

    Hopefully this family will get a satisfactory ending, even though it certainly won’t be a happy one.

  3. Paula Henry

    July 11, 2008 at 8:52 am

    Jeremy –

    How horribly sad and frustrating! I expect this happens more often than we hear about, simply, because of the lack of communiaction between lenders, their investors and attorneys.

    We, too, have had our lockboxes removed and the locks changes, impeding any additional showings. Try calling to find out anything and the maze of people you have to go through is astounding. Noone knows anything.

  4. Mack in Atlanta

    July 11, 2008 at 9:34 am

    This is the find of story that needs to be told. While it is totally unfortunate for the Dickson Family, there is a lesson to be learned. Anytime we sell a home that is that close to foreclosure we should contact the lender to insure that the proceedings have stopped.

    When Homebanc went out of business I wondered if the escrow accounts for the borrowers would be properly serviced. I published a post on my blog voicing this concern. I have been contacted by two different people whose accounts were not properly handled. One in Jacksonville, FL who’s homeowners insurance had not been paid and one in Chattanooga, TN who’s real estate taxes had not been paid. No telling how many others there are. The loans are supposed to be serviced by Countrywide or BOA. Who knows now.

  5. Barry Cunningham

    July 11, 2008 at 11:39 am

    Ok….I’ll be the bad guy here..seems like always..but c’mon…this should never have happened. I deal with foreclosures day in and day out. After all of the heat I’ve taken for calling on agents to “prove their mettle”..I see this tory which makes me want to puke.

    Awwwwww..it’s the bank’s fault…gotta call a whole lot of BS on this one. Big time, freshly dumped, hot in the Florida sun BS!!

    How many “professionals” screwed this up..starting with the agents involved?

    Here’s the deal…we run into this ALL day and every day. As a professional investment company we know that these things sometimes happen.

    In your post you wrote you said as much yourself. So why did this happen? Becasue too many of the professionals who were involved screwed up.

    1. Why did the closing happen without clear title (.i.e either a vacting of the final judgment of foreclosure)

    2. Why did nobody check if the auction was cancelled or appear to make sure or at very minimum call the clerk)

    3. Do you have any idea how long AFTER the auction took place it takes for the title to change hands…so you’re saying none of the “professionals” checked

    4. What kind of title company are they working who would write title with a final judgment of foreclosure still active on the property?

    5. How did the listing agent not know that there was no release or clearance of the final judgment

    6. Why were the Buyers advised to move in by the agents involved wioth none of this stuff being verified

    7. If it was seven days between the time they closed and the time they were “burglarized”…where was the writ of posession? The sheriff normally has to post a 24 hour notice BEFORE drilling out a lock…

    I could write perhaps 20 or more papragraphs that simply point to “professional” neglect at this point and a bunch more that says this does not make any sense.

    Nonetheless, it’s easy to blame the big bad bank..will any agent EVER stand up and look at what is going on in this industry and say an AGENT was culpable and had wrongdoing and flat out did not know what they were doing?

    You guys here at AG really ned to dig deeper and end the all out love fest. It’s like Active Rain on steroids. Let’s have some meaning ful discussion and when we see ineptitude call it out so others can learn from it.

    By the way…on the donation front..anyone know if the agents involved are giving back their commissions…or would that again be too much to ask, since they obviously EARNED their money!

    And you wonder…seriously…this is absurd!

  6. Jeremy Hart

    July 11, 2008 at 11:48 am

    I’ve got to run but I’ll get back to this later. Barry, I never said the bank was the only one to blame – in fact, maybe the agents involved have culpability. When I posted that this morning, I was trying to relate a story and allow for conversation, which you’ve always been willing to lend to.

    There are always three sides – sometimes more – to every story, I was just telling one.

  7. Barry Cunningham

    July 11, 2008 at 11:57 am

    Understood and benefit of the doubt given Jeremy …….but I don’t see ANYTHING about any real estate agents anywhere in your post and obviously that is where the problem began and should have been taken care of. There is no excuse for this kind of utter ineptitude.

  8. Jason Sandquist

    July 11, 2008 at 3:32 pm

    I would have to agree with Barry on this one (and like Jeremy said it was only one side of the story but it will be the major side that everyone relates to) about something being botched along the way. Unfortunately it had to happen to someone and of course they can’t trace any of their belongings.

    I am not the expert on REO’s and I admit I just started working with some companies on REO’s and even I feel overwhelmed, I have also said to some lenders this is all I can handle. One of the big things that I see is that agents that have been in the business for awhile, they have a lot of them, a lot. I don’t know how they can keep up with the weekly/monthly tasks on some of them. Banks just don’t go barging into houses first, sure some have systems that are broken. They would have got all the i’s dotted and t’s crossed before doing something like this IMHO

  9. Frank Jewett

    July 11, 2008 at 4:57 pm

    If I was working with buyers (I am not a licensee, so this is all hypothetical), I would advise them to ignore short sale listings and focus on either traditional listings or REOs, depending on the amount of risk they are willing to assume. The problem I’ve been hearing about locally is short sales that simply never close, despite being under contract for weeks or even months. The lender drags their heels until the property goes to auction and the buyers are left frustrated and put off by the whole process.

    No doubt this position would be frustrating to agents with short sale listings who were trying to help their clients get out of a bad situation in the best shape possible, but if I was representing buyers, I would have a duty to make them aware of the massive downside of getting involved with short sales, even if the price is right and the people are nice, simply because the lenders tend to screw up the deal for everyone, themselves included. REO also has pitfalls, but deep discounts can offset the risk.

    Again, I’m not a licensee, but I can tell you that this viewpoint is what I’m hearing from the majority of agents at marketing meetings in my area, and our market is not among the worst by any stretch.

  10. Ken Smith

    July 11, 2008 at 5:06 pm

    That is a really scary thought. Sure there are people who messed up, but that doesn’t change the fact that these people are without their possessions. Can you really picture what it would be like to come home to nothing. All photos and family memories are gone forever.

    Thanks for sharing the story, it will make me be even more diligent when dealing with bank own properties.

  11. Bob

    July 11, 2008 at 10:02 pm

    Short sales are not difficult to close. Each bank is different and understanding that is important. More importantly, short sales are not all the same, definitely not like REOs that are fairly boilerplate.

    Barry is dead on with this one. The brokers and agents may not have given up their commissions, but soon enough they’ll wish that is all that this negligence is going tol cost them.

  12. Frank Jewett

    July 11, 2008 at 10:38 pm

    Here in Santa Clara County, I’ve heard that less than 10% of short sales close. I’ve spoken with short sale specialists who claim the key to closing short sales is to submit a complete package to the bank up front, so I suppose you could blame some percentage of those failures on agents who don’t understand the process or don’t follow through in a timely manner, but I also suspect loss mitigators were fearful of taking responsibility for accepting offers that appeared too low. Now with REOs hitting the market at huge discounts, it’s much easier to justify accepting a big writedown on a short sale. I’ve also heard that banks are overwhelmed by the volume of short sales and REOs, so that’s another factor.

  13. Dan Connolly

    July 11, 2008 at 10:45 pm

    Jeremy, Maybe I am missing something here but the way I read this, the property didn’t actually foreclose, the asset manager just hadn’t notified the contractor that the foreclosure was cancelled and to stop the seizure of the contents of a house they expected to foreclose. So the title companies didn’t miss that the house was foreclosing, the asset manager forgot to cancel the “trash out” . Am I understanding this correctly?

    If so, it seems like a fairly clear fault here and I don’t really see how the Buyer’s agent could have anticipated or prevented this. At least in our market the Buyer’s agents don’t get to interact with the asset manager at all. I think the listing agent may have some liability but I don’t understand how the Buyer’s agent could be culpable.

    I agree that it would be terrible for the Buyers, much like it is for all of the countless victims of this summer’s flooding and the fires raging in California. There is a dollar value that can be placed on the contents and to my way of thinking a clear breakdown of communication between the lender and the asset manager which is where the fault lies.

  14. Matthew Rathbun

    July 12, 2008 at 12:41 am

    Barry, once again you’ve gone too far…

    First: Had you actually, you know, read the last paragraph, Jeremy uses words like Us and Our, therefore asserting that the conclusion was inclusive of agents in the industry, as he is one.

    Second: You have probably no idea if the state that this occurred in, is a Lien Theory or Title theory state and what implications that state’s statue may or may not have had. The story is absent any indication as to if a Homestead lien or NOD was filed. Many, many of the trustees in some states are simply overworked and cannot possibly record all the docs that they need to. Therefore there are many occasions when the title examiner will find nothing filed and the only indication of the distressed property is the payoff request from the lender, which often times comes when they darn well feel like it and maybe right at the day before closing.

    In Virginia, pending Foreclosure, Short Sales etc… are considered legally confidential and the Sellers have not affirmative obligation to tell ANYONE, at any point. This may have been the case in this story, as well. So if the Seller decides not to spill the beans, and there is no recordation of default of posted lien, how exactly is an agent to know this when representing his or her buyers? By most state statues the listing agents are also held to this level of confidentiality.

    Are you suggesting that an agent should go to the courthouse everyday post closing and after the attorney and only recognizable entitity that can provide clear title in certain states have provided such? How many days, weeks months do you think an agent needs to call the inept lender to see if they’ve done their jobs?

    Exactly what magic skillset do you feel an agent is empowered with that allows them to know about all phone calls made from a lender to a trash-out company?

    Third: You are dangerously close to providing legal advice and direction in this rant, and to the best of my knowledge you are not a bar sanctioned attorney in TX.

    As far as AG becoming like AR or all the respect that we tend to show one another bothering you…leave. I am sorry that this level of professionalism and regard for another person bothers you. No one is begging for your comments, your posts or for you to stay. You come here and try to bully the authors and people who comment. I don’t know what pleasure you get from that, but I can assure you that most people don’t enjoy it.

    I have tried to see your point of view, I have agreed when appropriate and tried reasoning otherwise. I’ve even defended you in the past against people who I have a large amount of respect for – I was wrong and they were right.

  15. Matthew Rathbun

    July 12, 2008 at 12:50 am

    Frank – you are absolutely right. If the buyer agent is worth their weight at all, than during the Buyer interview they will review the low success rate and potential pitfalls of purchasing a distressed properties and try to get buyer to conclude that this is not a good venue. The low success rate of shortsales are also “mostly” an agent issue. There are just some listings that cannot be sold, and a listing agent needs to be trained and prepared to do a proper interview and have a template of what listings they should and should not take.

    Bob – If the agents have done the right thing and the property was properly listed and handled, you’re right they are easy to close, they just require extra time on the phone and more paperwork. It starts from the very beginning. Listing agents who can’t sell the house and do the work, should walk away from the listing.

    I am a Certified Shortsale Professional Designee and Instructor with RealtyU (Swanepoel’s School) and a ABR/REBAC Foreclosure Course Instructor. Both of these courses train agents on how to interview, choose and pursue clients who are appropriate for these types of transactions. In our market place traditional listings are typically lower in price and have more negotiating room. We have an abundance of inventory; so alienating properties that have a low chance of selling is not damaging to the buyer.

  16. Eric Blackwell

    July 12, 2008 at 7:57 am

    I feel for the family.

    Yes, there are multiple people at fault here…but in the end, it is the family’s memories that are gone and that is sad.

  17. Benn Rosales

    July 12, 2008 at 8:36 am

    “I deal with foreclosures day in and day out.”

    It wasn’t foreclosed.

  18. Barry Cunningham

    July 12, 2008 at 11:37 am

    @ matt..typical, expected response. I can ASSURE you that no transaction I would be involved in would have this happen. Way too much riding on it and way too many people following up to ensure this does not happen. thump the rah-rah real estate agent chest all you want but the agent’s we train would NEVER have this happen to them.

    As for practicing law…shhhhh…people may read your comment and see your ignorance. Most, if not all that I wrote is a matter of public record. You simply need to know how to find the information.

    By the way..you asked if I knew the state…LMAO…did you actually read the post and article or just fire off a ticked off missive at me? If you had read the post and the linked article you would have seen that this occurred in the State of Texas. I have included a link to their foreclosure laws (we have every state on our website for free)

    https://www.realestateradiousa.com/blog/2008/02/24/texas-foreclosure-laws/

    You asked..”Exactly what magic skillset do you feel an agent is empowered with …do you really want me to answer that? Here’s one that at least one agent isn’t empowered with..the ability to review the foreclosure laws in a state.

    Matt…trust me, this is one area of real estate that isn’t for kids. I stand firm on my original statement and thanks a bunch for underscoring what I said.

    @ben..what exactly does this line mean in the post..”continued through the foreclosure process unimpeded”?

    I’m sorry..maybe I misunderstood. Not!

  19. Matthew Rathbun

    July 12, 2008 at 12:23 pm

    Barry,

    You’re right. I am naive and ignorant. However, I am happy.

    I don’t need to be abusive, unprofessional and demeaning to others to make myself feel important. I honestly thank God each day, that I am no longer that person.

    If being “smart” and “successful” means I have to treat people the way you do, I’d rather be neither.

    You twisted a post that was suppose to bring awareness about the pain of another. You twisted it to make it be all about you and how important you think you are and how ignorant you feel real estate agents are.

  20. Barry Cunningham

    July 12, 2008 at 12:44 pm

    No Matthew..I did not twist anything! I was completely respectful to Jeremy (the author) and there was not an iota of abuse written. Can’t stand on that soapbox in this regard.

    I questioned why agents don’t police themselves…is that demeaning and disrespectful? hardly. My original comment was not about me at all..why would it be? I pointed out the problems inherent with the situation and stated that the real estate agents had culpability. If you don’t see that then that’s hardly my problem.

    What is it that you and others feel that questioning other real estate agents and their handling of affairs is “disrespectful? Do you not want spirited discourse on this forum? Or do you only want that which follows in the path of heralding ALL agents?

    It’s easy to point fingers at me and blame me for being the black sheep that hangs out here. How about elevating discussion and talking about issues and problems that agents encounter so this type of thing does not happen again?

    My AR comment was based upon the fact that other than Bob above…are you telling me that NO OTHER real estate agent who visits this site can see the problems and potentially misrepresentative actions that could put these agents involved in a position of liability?

    Wouldn’t you and others want to know how to avoid these types of problems and how to ascertain this information?

    From your last comment I would have to say I guess not!

  21. Vicki Moore

    July 12, 2008 at 5:20 pm

    I can’t believe their belongings weren’t required to be held in storage for pick up at a later time – like for 30 days?? If they had possession for just 7 days it had to look to the property management company like they were in the process of moving out. I’m astonished.

    Whoa! That’s a scary story. I’ll be looking into how that works in my county. Geeze.

  22. Bill Lublin

    July 13, 2008 at 8:08 am

    Barry;
    Just for clarity, the foreclosure laws are really not the issue here. The issue is that the lender removed personal property without the authority to do so.
    As you know I invest as you do, however I have also be representing lenders for 20 years in the disposition of REO properties, and what happened here was atypical.

    Under the policies of most lenders, the people sent out to rekey the property (and then bid the trashout, or remove personal property) should have contacted the lender, let them know that there was substantial personal propety (which to most lenders means more then $300 worth) and looked for some clarification of the occupancy situation.

    If the property had been foreclosed upon, occupancy is determined by the amount of personal property in the house. If they property was not yet unpacked, most venodrs and REO agents, would have gone looking for the owner, instead of pulling the trigger so rapidly.

    The agent who sold the property to the buyer was not at fault here. If he (or she) had ben tol by the lender that the foreclosure process had stopped, that should have been sufficient, and indeed, the lender is probably the person who will write the check here.

    Being a Monday Morning Quarterback only gices the appearance of superior knowledge, not the actual superiority.

  23. Barry Cunningham

    July 13, 2008 at 9:24 am

    @ Bill…”Being a Monday Morning Quarterback only gices the appearance of superior knowledge, not the actual superiority”

    You’re absolutely right..maybe you should stop trying to be one as you seem to be a Joe Pisarcik at best.

    Was wondering when you were going to suit up and try to come to the rescue.

  24. Bob

    July 13, 2008 at 10:51 am

    I don’t think Barry is wrong on this. While it is atypical, there should be a paper trail for both agents to hide behind that would also allow the buyer to go “Here is the proof! You had no right to enter my property and remove and dispose of my personal property.”

    Absent that paper trail, the buck stops with the brokers/agents on this one.

    I hope for the buyers’ sake that these brokers have deep pockets.

  25. Robin | fort Lauderdale Real Estate

    July 13, 2008 at 10:56 am

    Bob..neither do I but they are deleting and censoring his comments so effectively it seems they don’t want him commenting anymore. I guess the AG / AR correlation stated above is true..shame.

  26. Robin | fort Lauderdale Real Estate

    July 13, 2008 at 11:34 am

    I stand corrected as I see a new comment

  27. Matthew Rathbun

    July 13, 2008 at 11:55 am

    Robin – Who’s comments are being altered? Whereas I’ve had my comments deleted on BHB, I’ve not known anyone’s to be deleted from AG.

    Bob – If I am a buyer’s agent and I have an document from a closing attorney that the clear title was transferred and properly was properly recorded at the courthouse, what other documents can I obtain that would guarantee that a lender wouldn’t make a mistake and order an illegal trespass and trash-out. I am not being snarky, I’m really open to hear what I can educate others to document or ensure that what amounts to a burglary doesn’t occur in the future. I would think a properly executed deed and pay-off to the original lender would be sufficient documentation to show a stay on the foreclosure process.

    I don’t disagree with Barry’s conclusion that Agents should have a better handle on defending their client’s interest but in this case the issue is what more could be done. Nothing I’ve heard thus far tell’s me that the agents did anything wrong. To automatically jump there, with recommendations as to what they can do better, is my premise for disagreement.

  28. Bill Lublin

    July 13, 2008 at 1:38 pm

    Barry –
    there was no one here who needed rescuing. You wre just, once againmaking comments that were inaccurate, and once again you try to substitute being glib for being accurate (and every Eagles fan loves Joe Pisarcik – remember the “Miracle at the Meadowlands”?)

    And though you make a snide comment, you still don’t respond to the facts of the matter in my comment.

    That the buyer’s agent could have done something better does not make them responsible for the error made by the vendor who cleaned out the property.

  29. Bill Lublin

    July 13, 2008 at 1:51 pm

    Bob;

    You wrote “While it is atypical, there should be a paper trail for both agents to hide behind that would also allow the buyer to go “Here is the proof! You had no right to enter my property and remove and dispose of my personal property.”

    There is such a document – the HUD-1 (and in our state, there would have also been a marked up title report which would have served as proof of insurance- I am not familiar with Texas, but if there was title insurance, there should have been some version of the same thing.)

    I think that the point I made earlier is important to looking at this situation. Eeven if the property had been foreclosed upon, people in possession of a property generally have rights that lenders are generally very careful of violating. In this instance, based on the story as related, it would seem that the company or companies charged with determining occupancy, rekeying the property, and removing personal property acted in a precipitous manner. And that is not the buyer’s real estate agent’s fault. I can’t even figure out how he would have known that those actions were ordered.

    On the other handm I would point out that the REO agnet receiving the assignment, should have checked the MLS upon receiving the assignment, and if he noted a recent sale, would have done well to call the selling agent to ask what happened, since he received an REO order. That might have avoided this issue as well (Though that agent had no responsibility to the buyers, he would have kept his or her client out of potential litigation by alerting them to the problem.)

  30. Bob

    July 13, 2008 at 2:18 pm

    Matthew, those documents are what I had in mind.

    My opinion here is jaundiced because I have seen screw ups with deals so close to foreclosure in the past. I have seen defaults cured, but trustee sales still go on because people assumed everyone did their job.

    I’m also betting that the personal property didnt go to thrift shops.

  31. Barry Cunningham

    July 13, 2008 at 2:25 pm

    Bill I am in detention now and my comments are being moderated…for some reason…

    In any event you are dead wrong. Might make those here see you in a different light and maybe it makes some feel better but you are dead wrong.

    When you say “foreclosure laws are really not the issue here”…you could not be more wrong. I can’t believe you would posture in that manner.

    The foreclosure laws dictate the manner in which the foreclsoure takes place, all the way through to posession.

    Having drilled out locks and tossed out furniture personally when taking posession of a foreclosure, the laws of the state ABSOLUTELY dictate how posession is to take place.

    When you say “bid the trashout” that would not even take place until possession was given to the lender. Which means it did not sell at auction.

    Bill..I am not going to waste time on this…you might want to save this argument for somebody else. You’re digging a bigger whole with your comments.

    Anyone that follows what you say in regards to how the possession of a foreclosure takes place either by the lender or by an investment company is getting seriously erroneous advice from you.

    You are not even close.

    In what might be the most revealing statement was when you said this “If the property had been foreclosed upon, occupancy is determined by the amount of personal property in the house”.

    All I can say is wow..and what a seriously erroneous statement. I won’t use the word I wanted to due to pending censorship…wow Bill…That’s really..really bad of you with all of your experience to utter such BS. Unreal.

    If you only knew how many times that my team and I have gone to a home with people still living in the home and had them removed and their belongings either tossed out or impounded ) at their cost)

    LMAO….”occupancy is determined by the amount of personal property in the house”…wow!!

  32. Barry Cunningham

    July 13, 2008 at 2:28 pm

    Hey bob..I’m off double secret probation it seems…you wrote “I’m also betting that the personal property didnt go to thrift shops”

    When a foreclosure takes place and the property is cleaned out, the person taking posession is not liable for any belongings left behind.

    We did a cleanout when taking posssession last year, and the neighbors who knew the people took their belongings off of the lawn while the owners went to try and rent a Uhaul…it was both sad and hilarious at the same time.

  33. Barry Cunningham

    July 13, 2008 at 2:38 pm

    Matthew often times the division of a bank that is handling the foreclosure with the attorneys and the department issuing payoffs are 2 different departments. I would think that an agent would know that.

    If I was on death row I would not be satisfied that the Governor spoke to the media and granted me clemency, I would want to know and would want to make sure that the guy flipping the switch knew.

    If one is well versed on the foreclsoure process and knows that often times the left hand is not talking to the right then yes there are most assuredly other steps to be taken to ensure that everyone got the proverbial memo!

    You wrote “clear title was transferred and properly was properly recorded at the courthouse, what other documents can I obtain that would guarantee that a lender wouldn’t make a mistake and order an illegal trespass and trash-out”

    1. Notice Of Cancellation From The Auction Clerk verifying the sale was postponed
    2. Actually go To the Foreclosure Sale and make sure that it was stopped
    3. If it wasn’t, possession is not granted immediately so you can have someone make ready a motion to vacate the sale
    4. Have a judge issue a stay of the writ of possession

    Many..many more..it’s all about experience and knowing what to do and having the resources to make it happen. If 3 and 4 above are beyond what a homeowner wants or can do on their own then you need to get an attorney to do it.

    I stand on my original comment. I absorb what you and Bill have written and what I realize is that there is so much that realtors need to do to educate themselves truly about this arena.

    It’s not child’s play and brining this to light is not demeaning or insulting.

    What’s demeaning is for an agent to have to go back to a client who they sold a house to and say..oops! Now that’s not a conversation I want to have..ever.

  34. Matthew Rathbun

    July 13, 2008 at 4:06 pm

    Barry, had comment 33 been 5 instead… Our entire interaction afterwards would have been different.

    There is some demeaning undertone, but only because I’ve seen you comment strand elsewhere.

    Otherwise, the four thing you mentioned are great options for agents to know, if they can legally have access to those interactions, knowledge etc… We don’t have Auction Clerks in our area, as it’s a trustee state. It’s pretty screwed up, but in Virginia there is really only one main trustee and the average time it takes Mr. Whites office to return phone calls is two weeks and then you get a clerk who hasn’t a clue. This is the same office that can’t seem to record NOD and homestead liens, etc… Our team faxes over the hud statement and a memo to the trustee, as the will not at all talk to you, unless you have written permission from the seller and lender.

    We’ve averaged out that on the norm there are 19 people that have some part of the foreclosure process once it’s began. Most of these folks are hidden behind completely unnavigable phone systems, so we sent faxes / mailed notices to all the folks that we can. However, seven days is awfully close and if anyone of these 19 people didn’t send the “memo” to their underlings there still maybe the opportunity for human error.

    We agree (as we tend to, once we surpass our equally inflated egos) that agents should show a large degree of due diligence in this regard, even more effort when we have knowledge that it’s a distressed property sale.

    My point is that even if everything is done by the agent, there are times (which seems to be this instance) when some loser doesn’t get the memo and orders a “burglary.”

    One thing that Virginia does, maybe better than TX, is that once the lender has taken possession of the property by virtue of the foreclosure, the person who buys the home must get an eviction notice and only a law enforcement officer can evict the original parties from the house. So in our case a duly sworn police officer / deputy would need to come to the house and forceable remove a previous owner from the house. Usually the judge ordering the eviction will given some amount of time (14 to 30 days) for the owner to move out.

    Therefore the new buyer wouldn’t come home to trash-out, but may come home to a cop sitting in the driveway ready to yank ’em out of the house.

  35. Barry Cunningham

    July 13, 2008 at 4:17 pm

    “Barry, had comment 33 been 5 instead… Our entire interaction afterwards would have been different. ”

    Ok..point taken

  36. Bill Lublin

    July 13, 2008 at 7:09 pm

    Barry; The unwarranted sense of superiority you bring to these comments amazes me as does the fact that you take statements out of context and respond to them as if they were the entire argument

    You respond to a statement “foreclosure laws are really not the issue here” which is not the comment I made.

    What I said was ‘Just for clarity, the foreclosure laws are really not the issue here. The issue is that the lender removed personal property without the authority to do so.

    And my statement was, and is accurate – if the lender had gone through the foreclosure process improperly (which the post states they did), that could have been corrected with little fuss or bother. That’s a matter of clearing the chain of title. Remember, this event took place 7 days after closing according to the post, which means that the lender had accepted a sum to satisfy the debt, and title should have been cleared at closing and insurance issued.

    The issue here, and the point of the post was that personal property was removed, and disposed of improperly.

    You then say,”Having drilled out locks and tossed out furniture personally when taking posession of a foreclosure, the laws of the state ABSOLUTELY dictate how posession is to take place.

    When you say “bid the trashout” that would not even take place until possession was given to the lender. Which means it did not sell at auction.”

    Aside from the fact that the sentences don’t make sense, you are again quoting me out of context., ignoring the fact that what I said was

    “Under the policies of most lenders, the people sent out to rekey the property (and then bid the trashout, or remove personal property) should have contacted the lender, let them know that there was substantial personal property (which to most lenders means more then $300 worth) and looked for some clarification of the occupancy situation.”

    For the 20 years I have been representing lenders, and after selling thousands of REO properties, that statement is completely accurate.

    If your point was to indicate that after a sheriff sale or auction, the party in possession (who may or may not be the former mortgagor) has not rights, and should consider themselves in danger of such precipitous action, I know you’re wrong in Pennsylvania and New Jersey, and would imagine that you would be wrong in many states in the Union, judging from the concern of lenders and attorneys representing lenders across the country that I associate with. However one place we do agree is that the laws of the state would determine the foreclosure process and the process for the new owner after the foreclosure to take possession of the property.

    The fault here is with the lender and their vendors, and possibly the agent for the lender if they were involved in inspecting the property to determine occupancy.

    I would agree with Matt’s statement “…. even if everything is done by the agent, there are times (which seems to be this instance) when some loser doesn’t get the memo and orders a “burglary.””
    And I agree that in times like these, the vigilance and diligence exercised by an agent needs to be at the highest possible level, because even if you do everything right, something can go wrong. However to escalate that responsibility and make this problem somehow to be laid at the feet of the buyer’s agent is absurd.

  37. Bill Lublin

    July 13, 2008 at 7:31 pm

    By the way, after re-reading your response to Matthew you responded to his question”what other documents can I obtain that would guarantee that a lender wouldn’t make a mistake and order an illegal trespass and trash-out” with the list of actions below-

    1. Notice Of Cancellation From The Auction Clerk verifying the sale was postponed
    2. Actually go To the Foreclosure Sale and make sure that it was stopped
    3. If it wasn’t, possession is not granted immediately so you can have someone make ready a motion to vacate the sale
    4. Have a judge issue a stay of the writ of possession

    While those actions would have avoided a title issue they would not have stopped the REO department, or their vendor from making the mistake they made, and doing the wrong thing that they did.

    As you properly point out the REO department is one of many departments at a lender, not all of whom have adequate communication. And when you add the MI companies, servicers, and GSEs to the mix, it gets even worse.
    I have had personal experience in the past, where properties have been assigned to agents and processes set in motion, even when the sale did not take place or when the property was bought by a third party at the sale. If that had happened then the vendor who rekeyed the property and emptied it improperly, would still have done so, going back to my statement way back which was ” the foreclosure laws are really not the issue here. The issue is that the lender removed personal property without the authority to do so.

  38. Barry Cunningham

    July 13, 2008 at 8:50 pm

    Save it Bill…maybe the cheerleaders will buy it..don’t have time for this. you are dead wrong.

    “You wrote..”Aside from the fact that the sentences don’t make sense”..they don’t make any sense to you because in this regard YOU HAVE ABSOLUTELY NO IDEA WHAT YOU ARE TALKING ABOUT.

    You know in order to have any kind of reasonable discussion with you you have to at miinimum be willing to openly state that agents don’t walk on water and make mistakes quite often. Maybe the agents in this case can call you as an expert witness.

    They most assuredly would get a Johnnie cochran type defense..you know..OJ didn’t do it and agents are never wrong.

    Like I said, you are wrong on so many points it’s not even worth speaking to you about this.

    If anyone wants any information that they need to work foreclosures and understand the process, they can contact me off the record as they often do here…and you can safe face to the choir.

    Wow…not sure if anyone has ever followed you into the men’s room but if they have they would have obviously told you that your s#$t most assuredly does indeed stink…contrary to popular belief.

  39. Benn Rosales

    July 13, 2008 at 9:37 pm

    Sorry, the comment issues had nothing to do with any one person, the entire site was moderated, including contributors and administrators. It is not uncommon and will not be the last time it happens if and when we have issues with mysql and or spam bots.

    regards,

  40. Jeremy Hart

    July 13, 2008 at 9:47 pm

    The best laid plans of mice and men …

    Barry, you wrote – “You guys here at AG really need to dig deeper and end the all out love fest. It’s like Active Rain on steroids. Let’s have some meaningful discussion and when we see ineptitude call it out so others can learn from it.”

    It’s flaxseed oil, Barry, at least that’s what my broker’s telling me it is. I don’t know for sure.

    Calling out ineptitude is one of the things I was hoping to do with that post, apparently that didn’t translate, but it certainly wasn’t an attack on any one individual (the agents) or the industry (at least I didn’t intend it to be). I had hoped that it’d be an eye-opener, a reminder that even when all looks well, something can – and will – go wrong. You can be uber-REALTOR®, or investor-extraordinaire, and still screw up.

    Goodnight all …

  41. Ush

    July 14, 2008 at 3:38 am

    This is one of those posts that further reinforces the public perception of real estate ‘professionals’.

    Joe Public’s real estate experience really ‘depends on who you get’ to help you through a transaction.

    Given the vast experience of the posters here, and the maturity of real estate process, one would expect that there is a understanding of how the process does/should work.

    If this group of seasoned real estate ‘professionals’ cannot agree, what level of service/competance should the public expect from their real estate preofessional?

    -Ush

  42. Bill Lublin

    July 14, 2008 at 3:47 am

    Barry;
    It amazes me that when you can’t make a coherent argument, your immediate reaction is to say “.don’t have time for this” and then go into a rant about items unrelated to the points made.

    Your sentences didn’t make sense because they were structured poorly grammatically and conveyed no information, not because of anything I said. As far as knowing what I’m talking about concerning REO properties, I was selling REOs before you knew they existed, so that’s just absurd.

    As far as your statement “you have to at minimum be willing to openly state that agents don’t walk on water and make mistakes quite often” Of course they , they’re human. In fact I pointed out that the agent hired by the bank might have some responsibility here, but you completely ignored the facts to make your argument as you do regularly.

    Again, your rant avoided the point of my comments which was the error made by the lender and their contractors and/agents (and the term here does not mean real estate professionals alone, but all of the people they employed on their behalf to act for them in this matter). You still haven’t addressed that, and they are the real culprits here.

    Barry, I do work as an expert witness, and have been admitted as such in Municipal, State and federal courts. But in this instance the buyers are suing the Mortgage company whose actions caused their problems, and the buyer’s agent don’t need an expert witness on lender practices. In fact if anyone where to hire me here it would be the buyers to testify about the policies of REO departments of large national lenders work. However I am sure that they would find someone more local who would provide them with the same information.

    You make the statement “you have to at minimum be willing to openly state that agents don’t walk on water and make mistakes quite often. ” After almost 30 years of working on Grievance and Ethics Committees, Hearing Panels, and Appeal Panels, I would say that statement is another piece of Cunningham bombast. I actually work towards the improvement of agent performance in my industry. But you never let facts or the truth get in your way when you want to make a glib statement.

    Jeremy made a terrific point, attempting to fix a problem, which you turned into an exercise in fixing blame (and doing a poor job of that). He said “it’s a sad state of affairs we’re seeing and we ALL have an opportunity to make it right. It’s not a THEM problem, it’s an US problem. I have no doubt that readers here are working to make their marketplaces better, but there’s still work to do.” Now there is an accurate, and substantial statement.

    I agree, its difficult to have a conversation with you. A conversation implies a dialog , but each Barry response is a monologue on a topic that was not part of the conversation, filled with rhetoric and inaccuracies.

    In all of my responses to you in every conversation, your failure to make a coherent point seems tied to an inexplicable inability to continue with specific points in the conversation. And each new statement of yours seems to be rant after rant, with no substance other then “Agents are terrible, everything is their fault, they are all beneath my contempt”

    I have no interest in who follows you in to the men’s room. and I would rather avoid your bathroom analogy, as crude and inaccurate as it is inept. Were I to be asked about your response, I would say it is almost Shakespearean. It reminds me of the speech from Macbeth, “.. a tale told by an idiot, full of sound and fury,Signifying nothing”

  43. Broker Bryant

    July 14, 2008 at 6:21 am

    Well this conversation went south quickly.

    Anyway, I was just thinking about the possibility of this happening the other day(the lock change not the following debate). It came to mind due to all the short sales in my area. My thought was to simply draw up a short letter “giving notice” to the world that the house has been sold and then simply post it on all points of entry to the property. Then take a few quick pictures of the notices for the file. It’s a very simple solution. I can’t control what others do but I can certainly protect my buyer. This stuff is not brain surgery.

  44. Bill Lublin

    July 14, 2008 at 7:13 am

    @Broker Bryant – Great idea! With the added benefit of being simple.

  45. Barry Cunningham

    July 14, 2008 at 7:22 am

    Hey bill..since you are such an “expert witness”..and feel I am being “bombastic” then why don’t you stand up instead of hiding behind a keyboard. We’ll be talking at length about this on the air today and we will have some true experts discussing this.

    Why don’t you step up to the plate and come on the air and let the country here what you have to say instead of preaching to the choir.

    It’s easy to take pot shots from a comfy office behind a keyboard. Come on the air and explain what you have been saying and we’ll let the public judge that which you are saying. I’ll even give you the last word.

    I’m really over you pontificating. I’m really over the pansying around and people feeling attacked. (man that word is so overused in the re blogosphere).

    You want to seem to others as the Grand old sage. I say the emperor has no clothes on and I’m willing to have the “dialog” (sic) that you so seek.

    Bring your best Bill, show me something. Show your peers something. Prove to me that you know what you’re talking about.

    You want to talk..you got it, not on a keyboard but rather directly. Do your research, come armed and be prepared.

    You know NOTHING of the foreclosure process as evidenced by your writings herein and addressing this further in print is useless. I don’t want to give you fodder for the choir..I am more interested in the masses. I will gladly debate you and show you how wrong you are and how little you know. I absolutely challenge you to debate me on the issues of this imbroglio.

    Absent your acceptance of this invitation, there’s nothing left to say. You want to have the debate…email me directly and we’ll set it up.

    I wouldn’t expect you to accept. However it’s fun to let others see what you look like naked.

  46. Barry Cunningham

    July 14, 2008 at 7:28 am

    BB..good idea but it’s not needed..especially here in Florida. If you want to know how to ensure that the foreclosure is indeed stopped and how the real estate agent representing the Buyer can absolutely make sure (yes it is possible)..just send me an email and I will get you the information.

    As one who personally evicts, does the trash outs and removes belongings and understands the entire foreclosure process from beginning to end (and beyond..yes there is a beyond)..I would be more than willing to help you in any way I can. Like I’ve told you BB…you are a stand up guy and I admire you and would be willing to assist you at any time.

    Contrary to what has been said, there is a very defined course of action and once followed there are no problems.

    I have no idea why some here simply do not get the fact that it is absolutely the agent’s responsibility and all they have to do is take the time and modicum of effort and this type of thing would 100% NEVER happen…NEVER. Ineptitude and inexperience caused this and it ABSOLUTELY can be avoided. Don’t let anyone tell you otherwise.

  47. Bill Lublin

    July 14, 2008 at 12:26 pm

    Barry: You need to cut down on your caffeine. – Now its gonna be fun. Watch for a post!

  48. Barry Cunningham

    July 14, 2008 at 2:22 pm

    does that mean you don’t want to come on the show?

  49. The Harriman Team

    July 16, 2008 at 1:21 pm

    Wow…wow…I find it hard to believe that a post about such a tragic and heart-rending occurrence could have been hijacked and turned into the Shootout at the OK Corral. After Michelle’s first, heartfelt statement of sympathy and concern for the victims in this travesty, the vast majority of the other 47 posts are all a moot discussion about who’s at fault. I have a lot of respect for Barry, Bill, Matt, and everyone else who commented on this post; I read all your posts voraciously because I feel I learn a lot through the wisdom that’s dispensed here and at BHB, among many others. And I know you all don’t know us and we’re just a flyspeck on the barn wall of RE.net, but I think this never should have been allowed to overshadow the original issue like it has. There’s a time and place for everything, and this was not the place for what has transpired here, IMHO. In my mind, this was not meaningful discourse regarding what transpired, only a sad game of brinkmanship between two respected members of the RE.net, reduced to hurling schoolyard insults at each other. Now, we’re all looking forward to Wyatt Earp and Frank Clanton locking horns again for supremacy in Tombstone. Meanwhile, what about the Dickson’s? Aren’t they the important issue here, not who’s at fault? I don’t get it. Sorry if I offended anyone here, but there are far better things for us to be doing than arguing amongst ourselves. I certainly hope that the Dickson’s can regain their home, their belongings and their trust in the homebuying process. I think all three will be SLOW in coming, if ever.

    I’m done now.

  50. Matthew Rathbun

    July 16, 2008 at 1:30 pm

    Harriman Team,

    You’re exactly right and it was a regrettable choice of timing and format. It’s not reflective of the spirit of AG. I do apologize.

  51. MrT

    October 7, 2008 at 7:54 am

    I live in Michigan…I “own” a condo unit. There is a condo unit directly next to me which was foreclosed on and is now a HUD unit. My crisis??? The contracting company “trashed-out” my HOME instead of the unit they were suppose to be emptying. My locks have been changed, i cannot even get into my condo and all of my belongings – EVERYTHING have been thrown away. How do i feel? Like my life has been erased! I am an orphan…my parents died when i was 9 years old, i am now 36…EVERY SINGLE MEMORY of my childhood and my life were in my condo and everything is now GONE! I am quite confident that the Co will be held responsible for the material objects etc…however, how do i put a $$$ on my priceless items??? AND…where does the responsibility begin and where does it end for this negligent act??? My sister drove by my condo and noticed a FOR SALE sign in the window…THAT’s how i found out about this crisis of mine!

  52. MrT

    October 7, 2008 at 8:01 am

    Sorry…my previous post may have been off base – but i can completely feel the pain of the Dicksons. I read the article and just went off on my own tangent – i hope you can understand.
    I didn’t mean to take any attention away from the family…i hope everyone understands that.

  53. Linda Hall

    December 8, 2008 at 9:02 am

    No one would have been at fault and there would have been no wrongdoing if personal property guidelines had been followed in the first place.

    I can see there are valid arguments on both sides of this particular issue regarding who’s to blame.

    But instead of all the finger-pointing, why not get down to the basics of how it could have been avoided if everyone understood what constitutes personal property in their state and how to do a personal property eviction?

    Just thought I’d throw in my .02.

    Linda

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