Banks hiring contractors to break in to listings

Hi All,

I have a short sale listing in Minnesota and the bank that I am working with (Selene Finance) and they have hired Meridian Asset Services to help negotiate the offer when one comes in.  I find out that either Selene or Meridian hired another company to break in to my listing knowing full well that it was secure and that utilities were still being paid for by the sellers.  The property is vacant.  This company drilled through the deadbolt, cut off my lockbox, and changed the lock on the front door. 

A representative from Meridian is also calling each of my sellers on a daily basis and telling them to cancel the listing contract with me and that she has another realtor lined up to take over. 

There has been no sheriff's sale yet so it is not bank owned.

Any suggestions on what I or my sellers can do about this?  I have reported the breaking and entering to the sheriff so far but I want to do more and so do my sellers.  This is such unethical behavior I just can't stand it and want to fight back.  Please offer any suggestions!

Thanks,

Carolyn

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Permalink Reply by Gabe Sanders on July 24, 2011 at 1:46am

In Florida, if the bank feels that the property may be in jeopardy, they have the right to do this.  But, it sure seems that this was not the case here.  

 

The troubling thing for me is the asset management's company's insistence on changing Realtor's.  Sounds like something fishy going on to me.  I think I would take this and present it to a knowledgeable attorney.  

Permalink Reply by Rick Ketterling on July 24, 2011 at 1:54am
Carolyn, the bank does have the right to secure the property if vacant/ abandoned. One thing you can do is put a sign on the door that says, do not change locks, home is being checked on and has not been abandoned. If you change locks, you will be breaking and entering into this home and we will prosecute you to the full extent of the law. Signed home owners. You can mix it up with what you would want to add, but the lock changers get the idea. I have also had clients go back out and change the locks again.

For the bank calling your sellers, they are interfering with your legal contract on the home, so I would fight them on this. Have you had your legal department call the bank? I would also talk with the department of commerce, and MAR to see if their legal department has any information for you. Good luck and press on.
Permalink Reply by Helen Cornwell on July 24, 2011 at 1:54am

Below is the response from my Seller who is going through a similar situation:



2. Please inform XXXXX that the next time they call my wife, who is 100% social security disabled, had brain surgery in January 2011, has not recovered from that brain surgery, and that THEY ARE USING TACTICS to put pressure on my wife to pay our mortgage, that I will pursue them in court via the American's For Disabilities Act to the fullest extent.

 

I realize your situation is a little different, still, pressure tactics on someone who is not able to handle.  Heck, I can barely handle it....

Permalink Reply by Napua Lucas on July 24, 2011 at 2:23am

Just read thru all the comments. Why don't you report this to your local TV station so they can comment publicly on it (via tv comments) to make the public aware of lender tactics and perhaps they can contact the violators as well to discuss this behavior and seek resolution. Do lenders really want bad publicity?  Here in Phoenix, AZ our local stations have help lines when the public gets no where with a retailer or whoever will not resolve an issue with a consumer and it is brought to the public attention on the local tv news. Believe it or not, most parties who wouldn't work with the consumer make an about turn and quickly resolve the issues. 

     I had LBPS (before their recent name change) go in to one of my short sale listings that had a purchase contract on it and was in the process of lender review and change the locks without notifying me, and the property was owner occupied. When the owner returned home she called me and she and I each called LPBS who said it was a mistake, they thought the property was vacant, and stating they had someone who had been watching the property (who for some unknown reason thought it was vacant) if you buy that story.  Anyone who would have entered the property would have known that it wasn't vacant--personal items and furniture in place.   Theft concerns loom when they do this sort of thing.

 

Permalink Reply by Victoria Frieberg on July 24, 2011 at 2:39am
I would contact Commerce and also the legal division of MAR, and your local board.  Would have to think Chris Galler would now who to follow up with.  I had a similar situation with another vendor..but they called me first, and tagged the door that the lock out would occur within 5 days.  that, as opposed to Meridian, is an ethical company.  They apologized when I explained that the home was vacant due to the sale falling apart within a couple days of closing, so client had to move..this also in MN.
Permalink Reply by Kathleen Sheridan on July 24, 2011 at 2:58am

The best option for sellers is to stay in their property until it settles. When the bank gets the idea that the property is vacant they step in to 'secure' it.

I had one company drill out the dead bolt and 'secure' the property with a metal clasp and a pad lock. When I had to get in for pre-settlement inspection, I got a maintenance person who cut off the padlock, easy as could be.

 

They also claimed that the utilities were off, which was not true. 

 

 

Permalink Reply by Kathleen Lordbock on July 24, 2011 at 3:03am

The lenders do not seem to understand that they are not yet the owners and that vacant is not the same as abandoned. I fight them all the time on this but I usually win the battle. Your owners need to talk with Selene Finance about this company that they hired and how they are handling the process.But since I assume they are also not making payments- it is not like they have that to threaten them with.

I had one  asset management company call  to inform me that they were going to mow the lawn on one of my properties- we had a couple inches of snow at the time and the sidewalks were kept  shoveled.I told them not to trespass- that they did not have permission. The asset management companies are anxious to do all they can as they bill the lender for their "services". The lenders should be informed that they are spending unnecessary funds for properties that have not been abandoned. Here in MN they get very anxious about winterizing even if the property is heated or it is summer!!

Permalink Reply by Heidi White, CDPE, San Diego on July 24, 2011 at 3:23am

This is THE NUMBER ONE REASON a seller should remain in the house. As Valerie stated above "They do it on my short sales all the time the minute they find out the property is vacant."

Save a copy of this thread to share with your clients during your listing presentation. You know, when your clients think their interests are best served by moving to that rental while their credit is still half decent - 8 months before the potential sale date.

 

Poor clients - they are darned if they do and darned if they don't.

Permalink Reply by Valerie Crowell on July 24, 2011 at 3:26am

It would seem to me that your Board should have a vested interest in going to bat with you on this one.  

 

I think I would definitely alert the local media, they love anything to do with the housing market right now and yours is a beauty.  I would also call the bank and tell them if the asset company doesn't back off you're going to personally sue them and the bank.  I'm sure there's something somewhere protecting your contract in your state.

And finally, there's always your Congressman.  

Permalink Reply by Jill Slyter on July 24, 2011 at 3:33am
Contact your state Senator and file a complaint. Also have your sellers contact the banking commission of your state and file a complaint...Last, but not least, contact FOX news, as they love these kind of stories. Make sure the lenders know this is your normal process and maybe they will change their unethical ways.
Permalink Reply by Josh M. Boggs on July 24, 2011 at 3:58am

Carolyn,

 

Sounds like possibly a smaller and regional portfolio lender?  I've had a few issues with Wells Fargo hiring out some very shady property preservation company that without warning or notice did the exact same thing to a vacant home my clients were maintaining.  No sticker or notice on the outside door to give us contact information to that contractor as well and of course Wells never could point us in the right direction. 

Never heard about a bank purposely and very forcefully working to convince the homeowners to list with someone else.  That's just laughable as the bank is not a party to the transaction, at least down here in TX.

 

 

Permalink Reply by Spencer Pettiford on July 24, 2011 at 4:03am
Carolyn,
One way to fight back is through SueMyMortgage.com depending on the state they will stop that foreclosure. Its actually a lawsuit against the bank that gives the leverage back to the homeowner. It doesnt matter if they're no longer in the house. People do themselves a disservice by not fighting back and its bad for the whole business because banks get more aggressive with doing things like this. Good Luck!

Spencer

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