Homes get stripped away in foreclosure

There is an unfortunate trend in Minnesota with homes owned by individuals who are not keeping current with their mortgage payments.  Some such owners, either during the foreclosure process, or even after the foreclosure sale (during the owner’s “redemption period”), are taking things from the home that aren’t bolted down (which is not all that atypical or problematic), and in some instances even things that are bolted down.

Certain items within a home, such as a refrigerator, stove, clothes washer, clothes dryer, and the like are considered “personal property” and are separate and distinct from the ownership of the home itself (which is called the “real property”).  These items are often taken by an owner or sold, before a foreclosed home ever makes it way back to the control of the bank as part of its REO (real estate owned) inventory.

In some instances, homeowners take this idea a little far (or way too far depending on the circumstances) by removing other items which they believe have value to them or salvage value.  Examples of this may include light fixtures, cabinetry, woodwork, digital thermostats, and other similar items.  Unfortunately, an article published in today’s Star Tribune (quoting Thomsen & Nybeck attorney Brad Boyd), identifies one of the more rare (but actual) examples where a homeowner goes to great length to dismantle and sell every conceivable item of value they can separate from the home, while keeping the home itself somewhat intact.  The Star Tribune article, by Jon Tevlin, can be found here:  http://www.startribune.com/local/48210437.html?elr=KArksUUUoDEy3LGDiO7aiU.

This author does not condone such an extreme (and inappropriate) process.  In fact, many “standard” mortgage documents contain language such as the following: “Borrower shall not destroy, damage or impair the Property, allow the Property to deteriorate or commit waste on the Property.”  In light of such language, obviously the issues addressed in this article would run quite contrary to a typical mortgage, and someone interested in this issue should address the legal implications with their real estate attorney.

Author:
This blog entry is written by Brad Boyd, Shareholder at Thomsen & Nybeck, P.A. Brad’s practice focuses primarily in Real Estate, Real Estate Brokerage, Business and Corporate law, and Wind Energy Law.  For more information about Brad Boyd or the firm’s real estate law practice, please visit the firm website at www.tn-law.com.