Geting paid not commit vandalism

[Exile]

It's probably no surprise that some people whose homes are being foreclosed trash the property inside and out just for spite. I recently read that some lenders actually pay defaulting borrowers not to vandalize their soon-to-be former homes.

On one hand, I suppose this is a form of preventative maintenance. Yet it's as though the lenders are caving into prospective extortion. Shouldn't they be charging malicious customers for damaging the premises instead of rewarding them for refraining from what they shouldn't be doing in the first place?

Yet, many lenders are guilty of not keeping up their repossessed vacant properties anyway, which devalues the rest of the area. If they rent them out, the only qualification for tenants is that they are breathing. I know this as DW and I lived in a neighborhood that went to hell because of foreclosures plus subsequent property neglect and low standards for renter qualifications by the mortgage holders.

What are we to make of all this? How much of the American real estate meltdown a character deficit on the part of both the borrowers and the lenders?

[GrimJack]

It is not necessarily the dis-possessed homeowner who vandalizes the house. As soon as the grass is left to grow for a couple weeks, someone will go in and get the appliances, then the surface items go like countertops, sinks and so one, then the wrecking crews come in and get the copper pipes and wiring. Within a month or two of property neglect, the house will become worthless. I mean the wiring right out to the pole is stripped. The house becomes unsellable. If paying the ex-owner to keep the property maintained keeps the house sellable, then it is probably worth the money

[LuxLiving]

I don't think they are paying for ongoing maintenance GrimJack. They maybe, I didn't see an article connected to read and I've only read one other article concerned w/this topic so I could be off base. What I perceived them to be doing is paying them a one time fee to leave the premises physically, turn over the keys, and leave the property in good order.

[Exile]

Originally Posted by GrimJack

It is not necessarily the dis-possessed homeowner who vandalizes the house. As soon as the grass is left to grow for a couple weeks, someone will go in and get the appliances, then the surface items go like countertops, sinks and so one, then the wrecking crews come in and get the copper pipes and wiring. Within a month or two of property neglect, the house will become worthless. I mean the wiring right out to the pole is stripped. The house becomes unsellable. If paying the ex-owner to keep the property maintained keeps the house sellable, then it is probably worth the money

Theft by squatters and vandals is a different matter from destruction by foreclosed homeowners. The news feature that I saw is based on the premise that it was the borrowers themselves who trashed the properties.

[GrimJack]

I see. If they can somehow prevent the dispossessed owner from vandalizing the place before s/he leaves, they can delay the onset of the 'vultures'.

I wonder if there is a correlation between homeowner vandalism and behavior of the lender. I have heard some horror stories of lenders who structure home loans so that the home-owner is almost forced to refinance every 2 years; adding more fees and prepayment penalties to the loan. This sort of predatory loan (similar in many ways to the payday loan industry) is dependent on a constant increase in the value of the home. Once the market flattened then fell, the homeowner would find that the $300k loan was now $500k and the house was worth $400k at best.

I hope my post makes sense; sometimes, when I think I am making perfect sense, people just look at me as say "hunh?".

[Exile]

Originally Posted by GrimJack

I see. If they can somehow prevent the dispossessed owner from vandalizing the place before s/he leaves, they can delay the onset of the 'vultures'.

I wonder if there is a correlation between homeowner vandalism and behavior of the lender. I have heard some horror stories of lenders who structure home loans so that the home-owner is almost forced to refinance every 2 years; adding more fees and prepayment penalties to the loan. This sort of predatory loan (similar in many ways to the payday loan industry) is dependent on a constant increase in the value of the home. Once the market flattened then fell, the homeowner would find that the $300k loan was now $500k and the house was worth $400k at best.

I hope my post makes sense; sometimes, when I think I am making perfect sense, people just look at me as say "hunh?".

Your post makes perfect sense, Grimjack. The "behavior of the lender" is exactly what I was alluding to in my OP when I mentioned character.