Foreclosure 'home rage' in Las Vegas

Worth reading and watching: This Wall Street Journal story and video about "home rage" in Las Vegas -- when owners of foreclosed homes trash the place on their way out the door.

The story quotes a local agent, Joe Kraemer, who says vandalism and outright theft are the rule rather than the exception. "Washer-dryer, refrigerator? Always gone. No matter what."

Other common departure tricks: flooded houses, and the old cement-down-the-toilet trick. These are some angry former homeowners.

The story explains that this is why banks and lenders pay a kind of ransom known as "cash for keys" -- up to $2,800 in one Vegas example -- to persuade homeowners to leave without trashing the place first.

Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com.

Photo: Getty Images

Hat tip: Take Five, via e-mail, who saw the story on Housing Panic

Comments

[Shameful]

What kind of example does this behavior set for the children in the household? Theft is one thing, and an understandable impulse. But pointless vandalism? Why are these homeowners punishing the banks for their own mistakes?

[Laker]

This whole (subprime) housing should be flushed down the toilet. But wait, someone had cemented the toilet and the whole sewer line is clogged. Upon continued attempts to flush it down by the fed, Bernanke and our government, the sh** is backed up and starts to shoot out up.
Similar to the movie RV (with Robin Williams) when he tries to dump the sh** of his RV while connecting hoses.

That is hilarious. People can live rent free for about 6 months, and then trash the place and leave. Why would they give the keys for pocket change of $2800....
Banks should pay real money for the keys (preferably in EUROs), something like $20,000-50,000 for keys for a $600,000 house. Since a trashed foreclosure will fetch about 30% less than a great condition house.
But again, banks are stupid, so they will end up losing 40% or more...
btw: Why wouldn't the owner (loan owner) take his fridge? It is a simple appliance connected to the outlet.
Maybe the banks want them to leave their computers, TVs, DVD player too since they are connected to the 110V mains? What kind of BS is that? The loan owner entitled to take anything that is removable !
I think it is good for the economy, since the new owner will need to furnish the house, and buy brand new appliances...

[buz]

This is called theft and vandalism and should be investigated and prosecuted as such. And these are the poor "victims" that need taxpayor money. HA. The politician that proposes to bailout these greedy idiots will lose.

[E]

C'mon Pete. This is yesterdays news. Housingpanic.com already featured it.

[LeavinLA]

This is truly sad.

However, it's not illegal to trash your own house. Until the bank has possession, there's no real crime here.

A serious moral lapse, yes. A crime, not so much.

[Pasadena'ed]

This is just one more reason lending practices will get tighter and tighter as this big ball of crap continues to roll down housing hill (and no, it hasn't reached bottom yet). Lenders will need to bake the "cement-down-the-toilet" contingency into their rates and fees moving forward.

This is what happens when you practically "giveaway" seemingly cheap mortages to "anybody" with a pulse.

Greedy lenders + low-life pseudo-owners = crap filled boomerang

[Loooco]

Since when are washers, dryers and refrigerators considered fixtures? Of course they are gone, they are personal property.

I brought mine to my house and I will take them if I ever sell.

[Tejano]

My amigo bought a repo where the previous owner had taken all the drawers rather than pack up boxes!

[anonymous]

While it is not illegal to trash your own house, these people are trashing homes that have a mortgage. Ergo, they are trashing the bank's property. Unless you hold title free and clear, you are committing a crime.

If the house came with those appliances, the same applies.

The last I heard (November, 2007), the banks are prosecuting the individuals who do this.

[mike]

i paid an ex girlfriend to get out once without trashing the house...

guess what. she trashed the place anyway

[gary]

to LeavinLa.............great point.

[mark g]

Well, these are the people that put no money down, got free money, cashed in equity to buy cars, boats, vacations, 2nd homes... it fits that they live like rock stars and end up trashing their "hotel room"...

[Loooco]

"While it is not illegal to trash your own house, these people are trashing homes that have a mortgage. Ergo, they are trashing the bank's property. Unless you hold title free and clear, you are committing a crime."

Nope. You are wrong, troll.

A mortgage is a security interest in a property...it is not an ownership interest.

Try again.

[anonymous]

Loooco,
What's up with the name calling? These people do not own the homes they are trashing. They are partially paid for properties. Their actions are criminal.

[Kathryn]

This is obvious. Maybe in this new housing bubble there are people who will walk away without trashing a house, but usually foreclosures are trashed in some way or another.

A friend of mine is an electrician, and he's been working on a trashed foreclosure that was practically gutted- plumbing electrical, furnace, all wrecked, and fixture and appliance gone, window glass etched with obscenities, holes in the drywall, water on the wood floors, spray paint everywhere. And this is a house in a very nice gated community. Owners claimed they left the house unlocked and vandals must have done the damage. Didn't really matter, owners were divorcing and declaring bankruptcy. I don't think the bank had any way of prosecuting owners for doing this- they don't have the money and it's hard to prove they actually did the damage.

I just think for most average homeowners, buying a foreclosure is a bit of a risk. Who knows what was done to the house or what the quality of the repairs were.

[Digitalian]

I'd be curious to know from any legal experts out there at what point does this kind of thing legally become vandalism of the bank's property? I would think that once the occupant has been given notice of foreclosure that they would no longer have the "right" to trash the home even if the bank allows them to stay for months afterwards.

[Rob]

Next stop.. Tweakerville, where copper is still $3.50lb. bolt cutters are extra and squatting is an option.

[Loooco]

anonymous,

When you can cite some law that supports your assertion, I will apologize for calling you a troll. Otherwise, if it looks like a duck and it quacks like a duck...

[Doug]

Looco: Anonymous at 1:35 p.m. is partially right.

I can't say if trashing your mortgaged home is a crime, but it is a civil wrong.

Quoting from Miller & Starr "California Real Estate 3rd":

"Any person who has an interest in real property that is subject to the lien of a mortgage or deed of trust has a duty not to do any act that will substantially impair the lienor's security, or that would constitute waste. This duty is imposed by law, independent of the covenants in the deed of trust . . ."

"Waste is the destruction, misuse, alteration, or neglect of real property by a person who is in lawful possession to the injury of the interest (or estate) of another in the property."

In California a lender's remedies for ordinary (non-malicious) waste are limited. It can sue the borrower/owner for damages only as part of a judicial foreclosure action, and can recover only to the extent the value of the property is less than the amount owed + costs of foreclosure. Damages for ordinary waste cannot be recovered as part of or following a trustee's sale, which is the foreclosure method used 99.9% of the time.

A lender can sue for bad faith (malicious) waste without a judicial foreclosure, but again is limited to the amount the property is worth less than the amount owed + foreclosure costs. A lender that followed sane underwriting practices in a steady housing market might have trouble meeting that damage threshold. However, it should be no problem in the current foreclosure scene.

Appliances are personal property (built-ins like wall ovens may be different). Not sure how appliances are treated, but would imagine they can be removed by the owner unless the mortgage also specifically includes them. Extension of a mortgage lien to personal property is not uncommon in secured business loans, but I would be surprised if it was used for a dwelling unit.

[Chris]

I live in the Phoenix area and in my neighborhood the foreclose rate is very high. This is definitely going on here, with people taking appliances and anything that isn't nailed down (and some things that are nailed down). The wife and I went for a walk over the weekend and saw one of the vacant foreclosed homes where someone has taken the garage door. I don't know whether it was taken by the previous owner or by someone after they had left, either way it is pathetic and these people should be prosecuted and sued for the damage.

[hugh jorgan]

Yo Loooco,

CA Penal Code 459

If the place has been forcelosed, then the bank owns the propoerty. It is burglary by definition.

[Cal]

http://www.reuters.com/article/wtMostRead/
idUSN2527885420080401

"Some homes worth less than their copper pipes"

There is gold in dem dere walls. Don't tell the homeowers, it'll give them some ideas.

Darn homeowers!

[John]

For those wondering about the legality? The owners have a legal duty not to waste the property. At a minimum, it's a tort, I believe.

I any event, it's a pretty low class form of behavior. Just think of all the decent people out there that still have a dream of owning a home some day. The Las Vegas home trashers are just hurting all future buyers. Look for 20% down payments required at some point in the future. People with real money at stake wouldn't act that way.

[Melinda]

This trashing of a place is not new, but it is also what is going to make the situation worse. Having dealt with rentals, and having to evict for non-payment of rent over an extented period of time, this has happened in the rental arena for ever. The ability to collect on the damage for either a rental or for a repo'ed home makes costs for everyone who is responsible higher. Many of these people are legally responsible, but financially unable to pay. That is what got them in the problem in the first place. Who will want to rent to someone who trashed the home the left. So when a landlord finds out that the former home owner trashed the home, what are they going to think will happen to property the prospective renter does not have a vested interest in? Sad as this is, it grows out of frustration in a situation where people feel they have no out and a lot of anger and blame with no tangible target. It is a cycle and one that will take time to break.

[tew]

There are no consequences either.

It's like an ordinary theft. Get caught doing it alone and you get arrested. Join a riot and haul off high priced goods in front of TV cameras and you're probably OK. Strength in numbers. These people know the banks are a) too overloaded to file police reports and b) are usually servicers and aren't as concerned about the home condition, since the note holder is the one getting crushed.

And the government wants supply off the market, so vandalism helps.

[Frank F]

Ah, America. What a great country.

[mbob]

Goodness gracious mierde oh dear -- scavengers and carrion consumers are picking off the easy prey.

In Detroit, my oft-cited example, non ferrous "mining" reached epic proportions years ago. In fact, the sight of 55 gal. drums perf'd for better combustion were the crucible of choice for burning off the insulation from wires. Pipes are harder to snag but weigh more. The mighty Kronk Gym, proving ground for Thomas Hearns, got "mined" for its copper plumbing and is no more.

Ask your neighborhood patrol police officer -- just how angry are people getting? I'd say more than less.

BTW, it's always a good idea to know who is on your 'hood's beat. Because that's who'll you'll call in a heartbeat when things go all squirrely and cattywampus and scary. And, wave at 'em next time you pass a patrol car. It'll help.

[victor knopp]

please put away your torches,the banks vandalized the entire country,they get a free pass,all due bonuses,and get to keep there extortionary jobs,someone please enlighten me as to the value of all these white coller criminals,they dont give capitalism a bad name,they destoryed it,greed is good,yea right,they should all be picking up trash on the side of the freeway,it would be the first honest day of work for all these worthless crooks

[Jim B]

The homeowners are the ones who are liable for the loans, regardless of what the market does. No one forced them to sign the loan papers, it was greed and/or stupidity. Much as I hate banks, I hope they somehow note the damage on the person's credit report and the person never has another dime of credit extended to them--ever! And I hope the banks that were greedy enough to make these loans in the first place go under. Oh, wait a minute, personal accountability and fairness... sorry, I just woke up from my dream.

[brad]

Loooco, your an idiot. The Bank perfected their interest via TD foreclosure. Consequently, the former owners (holdover tenants subject to eviction under California law) have committed criminal and tortious acts by destroying or otherwise damaging the Bank's property. Maybe a better name is Loco

[jbunniii]

"Washer-dryer, refrigerator? Always gone. No matter what." - Why would anyone leave these things behind? They're not part of the house, and what new buyer wants someone else's disgusting used appliances?

[Tombstone Realty]

There also could be the possibility that people see others leaving in the middle of the night, and think "KEG PARTY" and trash the place.

The banks don't secure the property - look what happened to Cleveland. It looks like Katrina hit it - all due to vandals and thieves, not *necessarily* the former tenants.

Or angry ex-girlfriends.

[martin]

...an interesting subject. And a sad one. I come from the old school that we should leave a hotel room neat after we leave it so that we make a good impression on the chamber maid. If I defaulted on a loan, I still think I would do the same thing. I may not get any Brownie points by that time. But at least I would know I didn't take a lump of chaos and smear it on the walls too.

Which brings up another point. On Monday evening a friend of mine from out of town parked his Mercedes overnight on a street in a good section of Silverlake. When he went to his car Tuesday morning, all windows were shattered and contents including clothing, audio and navigation equipment and two laptops,were all stolen from the vehicle. The thieves also vandalized the car by scraping a sharp item from the front of the paint job to the back.

He later told me that he learned from Automobile Club that there were, in Los Angeles City, 22 reported incidents of car breakins last night and this morning.
I can't explain how or why the Auto Club has this information.

The same thing happened on my Valley street a few weeks ago. Five cars got hit. One was right outside of my front yard. This is the first time I heard of such a crime on my block in over a decade.

Why do I mention this here? It seems to me that as the economy worsens, we can also expect more crime in our neighborhoods. We already have discussed here the danger involved if homes are left vacant or unattended for long periods of time. Imagine what would happen if enough people are scraping the bottom of a barrel for a few dollars.

[Ron]

"But pointless vandalism? Why are these homeowners punishing the banks for their own mistakes?"

Because they don't know any better. They were dumb enough to get themselves into stupid mortgage contracts so this is just an extension of that.

[John]

These are the same folks the politicians are going to bail out with your money. Get used to it.

[T. S. Elliot]

If you are dumb enough to use your home as a giant ATM machine you can live in your 3rd-mortgaged-financed SUV for all I care.

Stupid is as Stupid does.

See you in a dumpster at a 7-11 store in your 'Golden Years' when our China-financed empire comes a tumbling down!

[Teresa]

While not defending the actions of the trailer trash who engage in this behavior, I feel it's important to point out that this is NOT a new phenomenon...The subprime debacle did NOT birth this. I recall reading at least 20 years ago that one of the dangers of purchasing foreclosures is that the foreclosed owners often trash the place before they leave.

Further, it is not uncommon for evicted renters to trash a unit before they're kicked out. Ask any landlord.

Years ago, I actually witnessed some nut take a baseball bat to a studio apartment he was being evicted from. A scary sight.

[Teresa]

-------------Owners claimed they left the house unlocked and vandals must have done the damage. Didn't really matter, owners were divorcing and declaring bankruptcy. I don't think the bank had any way of prosecuting owners for doing this- they don't have the money and it's hard to prove they actually did the damage.-------------

Exactly. Unless there's a dead body in there, CSI is NOT going to come out and make a sweep of a site of a property-damage crime.

And without fingerprints, DNA, etc., even a novice lawyer can successfully argue that vandals must have broken in and done the damage...especially since, as we all know, that actually happens sometimes, particularly in communities where there are many empty houses.

The banks don't prosecute because there is very little chance of conviction.

----------These are the same folks the politicians are going to bail out with your money. Get used to it.------------

And of course the liberals will whine about how these poor, defenseless fambleeeeeees do all this out of "temporary insanity" and other such nonsense.

The guy I mentioned in my previous post, the evicted tenant who took a baseball bat to a studio apartment right before he left, was a trailer-trash drug addict. I imagine he's typical of the kind of people committing these crimes. While I suppose it is remotely possible that an upstanding individual would be driven mad and do this, the word "remotely" is key.

[Barbara]

I know people who had substantial equity in their house, never missed a payment, never paid late, they were very responsible individuals who wanted to tap into their house equity. Banks lowered the value of their home and wouldn't give them the cash payout they were asking for. Bank after bank the same thing. The family then decided to wait and try to sell the house. They lowered the house price but no buyers. Finally, they decided to walk away. To fit in the ruling society they decided to trash the place on their way out. Took what they could the rest of the property was damaged on purpose. The bank would need $100,000 to bring the house to normal condition. And I do support this couple. All they did they asked for a bit of cash and nobody would help them and the banks only wanted to collect their fees and points, leaving the owners with no cash at the end. I think this kind of justice is very sweet.

[Ed C.]

This is not new. It even happens to commercial real estate. Bad homeowners, bad businesses...they're all the same ilk. I have to admit, it must suck for those who've had their places trashed by their ex's.

[Rhonin]

What I see on here is a lot of losers who have never tried to buy a home. "oh, the prices are too high, I hope everything goes to he$$ so I can buy a home cheap". Most of you will own nothing and be nothing. The people losing their homes aren't flippers, they are hard working people who scrimped and saved to be able to buy a home. There is no reason that a home loan should be over 3%. In fact, there should be NO INTEREST on a home loan through the government. Who do you think gives the loan companies the money anyway? Everyone should be able to own a home if they work for it.

[the problemwithcaring]

He later told me that he learned from Automobile Club that there were, in Los Angeles City, 22 reported incidents of car breakins last night and this morning.
I can't explain how or why the Auto Club has this information.

Posted by: martin |

They prolly googled it.

LAPD has an interactive crime map with up to the minute stats, so all us paranoids can watch in almost real time as the city descends into mythical chaos...

http://www.lapdonline.org/crimemap/

[martin]

Thanks, theproblemwithcaring. I think, however, I'll pass on continually watching the LAPD's interactive crime map. I get my daily ration of heebie-jeebies reading some of the comments on this blog.

[Nancy]

Wow. I am just appalled. I thought only us measly, low-class renters trash houses. Gee, I guess owners aren't so different after all.

[Nancy]

Rhonin,

"they are hard working people who scrimped and saved to be able to buy a home. "

LOL. They are hard working people who trashed their houses? There's no excuse. Whatever.

[Santa Barbara Real Estate Voice]

This is a true reality as I have seen it a few times first hand. Many buyers are looking at these homes as deals but there are real people in hardship on the other side and many are angry. Buying a Bank Owned property is not smooth sailing and a buyer best be informed.

[John]

This kind of violent criminal activity is just more evidence of the ever-growing "culture" of the absence of any, personal responsibility. Immediate lethal injection is the only honest viable solution, to such bs. Violent animals should be "put down". Let's get started, eh?

[SonOfTigh]

I fully support the well-to-do family's actions. However , if it had benn me, I would have used about 10 lbs of fulminated mercury fo finish the job of cleraring out the house

[Crazy_Devil]

While this is a bad thing taking place, I feel much empaty for the poor family that got foreclosed despite their good credit.

If it had been me however, I would have finished clearing out the house with about 50 pounds of fulminated mercury or ammonium nitrate

[Tasha]

I am currently renting a home that is being foreclosed on and I an livid at the,"Washer, dryer always gone." comment.

Like MOST rental homes, the home I am currently in DID NOT come with a washer and dyer. And like many rental homes the one I am in DID NOT come with a refrigerator.

I am already losing over $2,000 in deposits. Should I also lose the $1,000 I paid for my washer, dryer and refrigerator?

In addition, whenever I speak with these foreclosure people, the attitude they use with the deadbeats they deal with all day is carried over and they tend to treat me like I've done something wrong.

The mistakes that were made were made by the bank (loaning out $300,000 on a house only 3 years old now worth $200,000) and the currant owner (not paying his mortgage). I did my homework, the house was not in default when I rented it. And frankly, I'm sick to death of being treated like a criminal.

I don't plan on trashing the house, it will probably be the nicest looking house at the auction. But it does truly suck to be seven months pregnant with four kids and two huge dogs and my husband just left his job to start his own business-and now two weeks to find a place-uhgg!