Wednesday, June 09, 2010

"It's Like The Wild West Out There" Says Lawyer As F'closing Banks Skip Eviction Process When Snatching Homes, Grant Salvage Rights To Trash-Out Crews

In Detroit, Michigan, the Detroit Free Press reports:
  • Some Michigan residents have returned home to find their windows broken, houses ransacked and valuables missing. Not from burglars, but overzealous mortgage lenders and their trash-out teams: unlicensed crews hired to clean out and secure property during foreclosures. Lawsuits filed across Michigan and the nation paint an ugly picture of impersonal foreclosures bent on speed that cut legal corners without concern for homeowners who have paid up.


  • Lawyers in [some] suits contend that some lenders, their lawyers and property management firms are granting salvage rights to trash-out crews, who then take TVs, furniture and other personal property. "It's like the Wild West out there," said attorney William Yochim, representing a Royal Oak homeowner whose residence was trashed out even after he paid it off.(1)


  • Although evictions require court orders -- even on foreclosed homes -- the Free Press found several cases in which court orders for evictions were never sought, including the Powelson case. One legal step that could have prevented the Powelson trash-out was an eviction proceeding. Real estate law experts say it's a necessary step before entering someone's home.

  • "Just because you have a foreclosure and just because the redemption period has expired doesn't mean that the lender has the right to go in and seize personal property," said Lawrence Shoffner, a Detroit lawyer who specializes in real estate and has written educational materials on the matter for the Michigan Bar Association. "You still have to go to court and get an eviction order."

  • Shoffner said the eviction process is straightforward. The lender seeks an eviction order from the local district court, which typically schedules a hearing within 10 days. If no one contests the order, it's usually granted through a summary judgment. With the court order in hand, the lender can then go to the property, typically with a court officer or bailiff, to enforce it. Any personal belongings remaining in the property are supposed to be left at the curb for the owner to reclaim.

For more, see Foreclosures go wrong as lenders, cleanup crews cut legal corners.

For a Detroit Free Press editorial, see Prosecute lenders responsible for gross foreclosure abuses.

(1) "They are like vultures," another attorney said. "Whoever gets in there first takes the possessions."