It is in the news and it's happening in our communities - homeowners removing everything including the kitchen sink from their homes when facing foreclosure. Homeowners stripping their houses.
Sometimes it is as simple as removing all the appliances and ceiling fans. However, more and more frequently items such as air conditioner systems (compressor and handler), kitchen cabinets, bathroom vanities, toilets, windows, french doors - nothing is left behind.
A few months ago, when showing one of my short sale listings I found the pool deck pavers had been removed! The seller later explained that he paid nearly $10,000 for the pavers and was able to sell them for $3,000 - that will help with his moving expenses.
Another seller literally sold her house piece by piece in an effort to keep a roof over her children's head - first she sold her furniture, then fixtures & fans, appliances, etc. It was awful to see what was once a beautiful home transformed into just a shell with all the adornments gone.
Stripping is sometimes understandable. Most homeowners I work with have no cash for moving, utility deposits and basic living expenses. Unemployment and loss of income ranks as the #1 reason homeowners find themselves in a foreclosure crisis.
Trying to sell a stripped house is challenging. If the kitchen has been removed, a buyer will not be able to secure financing (especially if the house is being purchased as owner-occupant). A seller that strips his house rather shoots himself in the foot.
Typical Deed in Lieu agreements prohibit the homeowner from stripping or vandalizing the home; short sales are difficult on a stripped home so the house winds up going back to the bank as a foreclosure (which is the worst case scenario for the homeowner).
The foreclosure will cause long lasting residual effects on the homeowners credit report - far worse than a short sale or DIL. Houses should not be stripped when motivated by a sense of entitlement, retaliation or greed. If considering stripping a house, long term consequences vs. short term gains should be carefully thought out.
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