THEY CHANGED THE LOCKS!! NOW WHAT??
September 11th, 2009, 2:33 pm
Agents and brokers have been asking us what happens when a lender winterizes a home and changes the locks on a homeowner while they are in the process of doing a short sale.
First of all, let me make it perfectly clear: A homeowner remains the homeowner until they no longer own their home. This means that unless and until the lender auctions the home and completes the foreclosure process by recording the foreclosure deed, the homeowner continues to have all of the full legal rights, authority and benefits of being a homeowner.
Keep in mind, the lender/investor has a collateral stake in their investment and has the right to make certain their investment is protected. This means if the lender has a reasonable suspicion that a property has been vacated or abandoned, they have a right to make reasonable entry to secure the property in order to prevent damage, vandalism, etc. However, just because a lender takes precautionary measures to “secure” a property does not mean they can take “possession” from the homeowner. If locks are changed at anytime prior to a foreclosure deed being recorded, the homeowner has the right to change the locks out themselves and continue their possession until the disposition of their property is concluded.
Also keep in mind that even if the homeowner’s property is auctioned and they are still occupying their home at the time, they can remain in their home until a judge tells them they need to vacate. All tenancy laws would need to be followed and the new owners (whether it be a bank buyback (REO) or third party purchase) would have to follow proper eviction procedures.
IMPORTANT - Foreclosed homeowners should NOT accept any “Cash for Keys” offers from the lender or third party purchaser unless they are absolutely certain they can realistically fulfill the terms of such agreement, which include the ability to vacate the property by a certain date. If the homeowner should accept such an agreement, they will loose any protections and rights they may have had available to them.
The forgoing post was written by Rick D. Misitano
