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 Victoria Frieberg on July 24, 2011 at 4:04am

i think if they are keeping utilities running, heat, air...mowing yard, and checking on the building..cleaning...they are doing what any snow bunny does when leaving for a winter in another state..just sayiin..My client may have to leave the state occasionally for a job hunt..who makes that call?  I think they do..

 

Permalink Reply by Elizabeth Meyer on July 24, 2011 at 4:11am

Can the bank really do this legally.. often not.  But is it worth it to fight with them...I've decided no.  Instead I just work around this issues.

 

This scenario happens in AZ a lot and as such I never tell a bank a property is vacant.  It's the first question they ask when I call in for updates. But, I ask the Sellers to leave a few personal items in the house and tell the bank, honestly, that the sellers haven't moved everything out yet. 

 

 

Permalink Reply by Alyce Nelson on July 24, 2011 at 4:14am

Since you are confident with the relationship you have with your sellers, perhaps have one of them tell the bank they are interested but want to interview the agents they are proposing before they make the switch.  Once you have agent names this becomes a different matter and you can take it to your Board of Realtors and State Licensing Board.  Most states have strict laws against this sort of activity.  Seems like the SAG's office is a dead end for you that you need a venue that is more passionate about the violations… like the Lic Brd and the Brd of Realtors

 

Another thought is about the $1,000... sounds like a bribe to me.  Get one the sellers to pose interest going forward and get the details.... then add this to the info you take to the Board of Realtors and State Lic Board...  If they do not have to sign any kind of promise not to cancel with the new agent, let them get the $1K, cancel the contract and return to you! ;)  If it goes so far as to get the check, be sure to get a copy….

 

Another thought...  Find out if the investor is Freddie or Fannie (you can do this yourself on the web).  If it is, line up your documentation (you'll need un-biased hard evidence you can fax) and then contact them and report the abuse.  If you do this, have your evidence lined up BEFORE you make initial contact as both these organizations seem to operate from the belief their servicers can do no wrong and would never lie to them...

 

One last thought… as for another company processing the short sale for the lender they will need to demonstrate a written and verifiable authorization to do this.  Your seller’s processing contract/loan is with the lender, not their third party, and unless there is written authorization your seller has no business turning over the highly invasive, confidential, and personal documents and statements that are require to complete a short sale to a complete stranger; not to mention that the seller has no idea of the third parties privacy policy which should also be demanded.  If the seller qualifies for HAFA that could give you more support as well by getting the HAFA folks involved… not always a help, but sometimes. 

 

Those are my thoughts… Please let the community here know how all this turns out. Best of luck to you and your sellers.

:)Alyce

 

Permalink Reply by Sue Edwards on July 24, 2011 at 4:30am

Have you faxed a letter signed by the seller to the lender stating that they don't want to be called any more?

 

It's possible that your seller's don't understand the $1000.00 offer and they actually may be being offered a deed in lieu of foreclosure.

Permalink Reply by Thom Colby CA Brkr 888-391-5245 on July 24, 2011 at 4:31am

Carolyn,

 

Here's what I do when I have an uncooperative or unethical lender / property preservation company or even a bad client.

 

It's cheap to record calls, you can buy a device that connects to your phone at any radio shack or use Ring Central's service and press *9 to begin or end recording.  (This is not advertising for Ring Central, I just happen to use their services) 

 

At the beginning of the telephone call with either of these companies read a script to them that says; "all telephone calls with me are recorded, any illegal or unethical statements will be immediately provided to the local District Attorney"  You MUST tell them at the start of the conversation.

 

I also include a statement in my e-mail signature in addition to the standard - if you received this by mistake, etc.  that says "All telephone calls with me or my office may be recorded, you have been notified"

 

In most states you have to tell the other person you are recording, in some states such as California where I am, you must have agreement by all parties to record.  If the other person does not want the call recorded, they can simply hang-up.

 

Believe me, you will get their attention very quickly.  I've been doing this with difficult situations for many years and it works to everyone's benefit.

 

Best of luck,

 

Thom Colby

Broker

Newport Beach CA

Permalink Reply by Marcy Moyer on July 24, 2011 at 4:31am
I have been hearing about this more and more often.  I think that is there are any vacant listings that it is a good idea to take pictures of the house with the lock box, show that it is secure, and take pictures of everything in side the house to give to the lender when initiating the short sale.  That way there is no confusion over what the status is and what is in the house.
Permalink Reply by Brian Brumpton on July 24, 2011 at 4:47am
 

Unfortunately, as Jeff points out, a lot of the contractors are just doing as they've been instructed. We've had to go back out and change the locks out again after they've done this. I've got a few contractors in my area that are very courteous and will usually give me a call and either provide me with a key or leave access in some way. Usually they're willing to change the lock on a back door if available and leave my lockbox in place. I can't fault the lender for wanting to secure the property. I've seen some bad things happen to abandoned properties.

As far as a lender interfering with a broker/client relationship that’s illegal in our state and I would be on the phone with the real estate commission providing those details in a heartbeat. I wonder if the agent they have lined up is aware of this. It's a huge liability on their part to have a servicer doing that.

Permalink Reply by Jeffrey Burnham on July 24, 2011 at 4:57am

I'm not sure about your State...but in Nevada I believe this is called "Tortious Interference" (and: PLEASE CHECK WITH YOUR ATTORNEY, AS I AM NOT PRACTICING LAW-how's that for a disclaimer? lol).

 

But seriously, I would think you could collect damages? I would wonder if you can find other agents in the same situation that you could hire a good attorney (wait... that's an oxymoron....hire a "proficient" attorney) and do a class action suit?

 

Keep us posted.

Permalink Reply by Kieran Jackson on July 24, 2011 at 4:59am

Some bank did this to me on one of my short sales in Cleveland. Changed all the locks. Then, had the nerve to call me and tell me I had to meet their BPO agent at the property so they could get their own value estimate.

 

Very petty, I know, but it really ticked me off that they changed the access of entry to the house then expected me be at the property so another of their vendors could gain access!

 

All the best,

~Kieran~

Permalink Reply by rocco racioppo on July 24, 2011 at 5:07am
Lender has the right to change the locks to a vacant property. But, the seller also has the right to enter that property and can request copy of new key. Do you have a copy of the new key?
Permalink Reply by James White on July 24, 2011 at 5:16am
I agree with Napua, call the local TV stations, continue with the prosecutor and pursue a with litigation for contract infringement. Your local or State NAR chapter may even take this on. Hit them hard. We all need to stand up for our clients and our industry. I feel for the sellers.
Permalink Reply by Kieran Jackson on July 24, 2011 at 5:19am

If you have an agent, with a listing, and there is a lockbox on that property... uhhh... IT AINT VACANT!

 

The banks need to back off!

 

All the best,

~Kieran~

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