Neighbor still in the house???

[drummer1]

I saw a thread about forecloser taking longer, the guy across the street from me filed BK Back in january, the bank won a lift of stay and forclosed,, this guy is still living there????? how is this possible? wouldent they have changed the locks by now? its almost a year?? he even baught a new audi a few months ago?? I know all this because my wife and I saw it all on pacer.....and the bank has sent people by there a few times etc...anyway, how the heck is he getting away with still living there??

[HHM]

It might depend on how foreclosure works in your state and whether the debtor still has right of possession during any redemption time frame.

If the house has gone to auction, he should not be there. But in most states, it is not a crime to stay longer. The bank usually has to go through formal eviction procedures to remove a hold-over debtor. I would guess that the bank has not gone foward with eviction, or eviction is not complete. But once eviction takes place, then the bank can call the sheriff.

I wouldn't advise doing this as a debtor as the costs of eviction are POST-BK debts.

[Westlane]

Im wondering about this myself. I would suspect that the bank has the property listed for sale, but doesnt want to bother with eviction costs and property maintenance issues until the property is resold. It could be the debtor still has the utilities in his own name and is picking up some other costs like taxes and insurance.
But perhaps you could ask your neighbor this question...and by all means, let us know what he says

[BKOnce]

Better having/leaving the owner there watching/guarding house until sold than ... than letting other thieve/crook/burglar... broke-in/stealing/destroy property remains !?

[drummer1]

well, he has let the grass go, the leaves pile up etc..I was home when a rep from the bank drove by, they told me they were going to hire someone to keep the place up...anyway very strange....the owner -or- former owner is as non chalant as can be and seens happy as a clam to just stay there as long as possible and enjoy his new car! He is acually a former mortgage broker and even had ads on local TV Chanells ! I am guessing he knows how to play the system to its ful advantage...I have just never seen anything like it, Early last summer they had an auction...lots of people here....all of a sudden at the last minute the guy yells out that it had been called off...anyway I would think the bank wants its house...


What bugs me is that my wife and I are stressing over our BK And this guy is driving a new car, wearing suits everyday and not paying a mort..and as happy as can be...its sur real...
I dont want to ask him because I feel uncomfortable doing so and I dont want him to know I saw his BK on pacer

[BKOnce]

Yep.. he is saving few grands now per month for that new car downpayment to enjoy a rent-free roaming business place... a smart guy indeed!!.. I admire his courage & care-free living/enjoyment until it lasts...

[Hillbilly]

Maybe if you look at it this way....... In foreclosure the homeowner is giving up any equity that they may have accumulated in the property, along with all of those expenses incurred in the original acquisition, any labor or improvements that they made to the property during their occupancy, along with most of their former plans, hopes and dreams.
If they are knowledgeable about how foreclosure works in their area, there usually is no valid reason for them to vacate the property prematurely, only to immediately take on totally unnecessary replacement housing expenses.
It only makes good financial sense to capitalize on this once-in-a-lifetime opportunity to live house-payment free for as long as possible. Doing so is no more dishonest or immoral than the failure to live up to all of the contractual obligations that were agreed to in the original mortgage. Moving out prematurely is NOT going to make the lender any happier, or give them any higher opinion of you.

[325Falcon]

Why are you so caught up what what he is doing?

[Westlane]

...I just want to know how he is able to beat the system!

[Hillbilly]

Some states have a "Redemption Period" following the foreclosure sale (in Michigan it is of 6 months duration) the debtor is allowed to remain in possession of the property until the expiration of the Redemption Period on the premise that they may be able to find refinancing or a source of funds that might allow them to pay off their default (+ any additional interest and fees) and so be able to "redeem" (buy back) their homestead.
This is because under certain circumstances a property will be foreclosed on where the homeowner has substantial equity, (say $100k on a $200k home) but has been unable to meet the payments, or obtain new financing before the foreclosure auction takes place.
It would not be socially or morally right to deprive such an unfortunate individual of both their home and their equity.
Following the auction, usually by a couple of weeks, an inspector will be sent to determine whether the property is still being occupied, if it is determined that it is no longer being inhabited, it will be declared "abandoned" and the Redemption Period is terminated.
Thus if there exists even the slightest possibility that the property might be redeemed, it is necessary that the debtor remain in residence, otherwise the statutory Redemption Period is automatically voided and cannot be reinstated.
You cannot "move out" and then come up with the money, and move back in. When you move out, and it is known, you are out permanently.
Admittedly, most people on reaching the point where their house has already been sold, will not be able to come up with the redemption amount.
It makes good financial sense to remain on the property for as long as the laws permit.
Again it needs emphasised, The Redemption statutes exist to provide for extenuating circumstances, and because who knows, a benefactor may step up, or an unexpected windfall may come, or perhaps, mundane as it may be, new financing may yet be found.
And now-days, with so many foreclosures taking place, many banks are delaying or are "behind on" evictions, so some people are still occupying their foreclosed properties far beyond what is the "maximum" allowed, some over 18 months past the sale date (The Mortgage company being the "buyer" on the note, and no one actually waiting or wanting to take any actual physical "possession" of the property)
edited to add;
This is my understanding of the "how and why" of redemption laws. In my own case, I remained on the premises of my Michigan residence for about 5 months after the foreclosure sale, while gradually moving my household belongings to a home that I had purchased over 500 miles away. I left voluntarily and when I was ready. Other than a "Notice of Foreclosure" being placed on the house, there was no contact from the Courts or the Police.
It has been almost 2 years since making my last payment, the house is still unsold and vacant, and with no suits or judgments, I've not yet needed the relief provided by BK.
I am adding this because many are under the impression that they are going to be "thrown off the property" immediately following the foreclosure sale, and hence are motivated to flee, and are thus depriving themselves of the several benefits provided by the statutory Redemption Period.
This is based on my own understanding and experience, I AM NOT a Lawyer, other states may have different laws and procedures, you will need to consult with your local Attorneys, and/or bone up on the laws and statutes that apply in your own state.

[demismom]

Hillbilly is mostly correct, except on the redemption period. While it IS 6 months for the most part, if you have filed bk and your intention is stated that you are surrenduring your property the redemption period is reduced to 30 days. I just went through it myself in September and my redemption period was 30 days. I live in Michigan.

[Hillbilly]

Whew! sure glad that I didn't need to file bk! Did you receive a notice to vacate within the 30 days redemption period? How long did you, or do you think that you may have been able to remain in the house?
In my case, I was able to save about $7500 in mortgage payments during the time that I remained there, and it would have been considerably more if I had stretched it to the limits.
I am wondering, Could one NOT state any "intention to surrender" or not sign an Affirmation agreement, and thereby be able to retain the full 6 month redemption period, and yet "walk away" before the time was up, or being evicted?

[demismom]

Hill - I'm sure they could do that, a lot of people do because they fully intend to keep their home, but circumstances arise and they must give it up.

We had purchased another home with the intention of selling the first in 2005. When it became evident it wasn't going to sell anytime soon, we rented it out. That worked until they stopped paying rent. Had to go to court twice in 12 months to have renters evicted, the last ones stole every appliance when they left. So, I was already out when the foreclosure sale happened and the house was already empty.

I had gotten a letter in the mail about the 30 day redemption period.

[tay666]

I too will be surrendering my house when we file chapter 7.
And I fully intend to stay here as long as I can without makeing a house payment.
That money will come in handy to replace our vehicles and to put a little money away so we can affor the first month / last month / securety deposit on a place to rent when the time comes.

And since we have equity in the house, if it sells for more than we owe on it we actually get to keep the first $10000 in profits as that is our homestead exemtion here in Ohio.

I have been scraping by the last year, and selling personal belongings just to make utility payments.
You can bet I am going to get as much as I can out of this situation once I file BK.