Why Mold Remediation Companies Love Banks, Short Sales and Loan Modifications

By
Real Estate Agent with Keller Williams Realty Louisville East (502) 664-7827

Banks often turn down valid short sale offers, then turn around and send the house into a 2 year foreclosure tailspin. Banks also yank sellers around with loan modification processes that take a year for denial, then turn around and foreclose on the borrowers who are willing and able to make monthly payments.

Months of Vacancy Can Be Conducive to Mold Growth

While all these bank inefficiencies are dragging out, those pesky things called water, humidity and laws of nature keep working on the house. Banks can cite "policy" and file lawsuits against borrowers, but they can't serve papers on Mother Nature, ordering her to cease and desist from working on the house.

Just take a tour of bank owned houses and note how many of these vacant REO's (stands for Real Estate Owned by bank) have mold problems that could have been avoided.

Banks Bicker Now But Lose More Later

The greater diminished value resulting from mold should be compared to the smaller amount the banks bickered over when they turned down a short sale one or two years earlier.

A $10,000 mold remediation job does not diminish the home's value by $10,000. It could diminish the home's value by $30,000 or $50,000 or more. Mold will cause the house to fail inspections, will taint the house forever because it must be disclosed even after remediation, and the walls, floors and systems still need to be restored after the mold remediator leaves the house.

Mold remediation companies are extremely busy these days.

 

 

 

Posted by

 

 

Dave Halpern, Realtor

The Dave Halpern Real Estate Group

Keller Williams Realty Louisville East

Website David.DavidHalpernRealtor.com

(502) 664-7827

 

 

View Dave Halpern's profile on LinkedIndave_halpern twitterhalperndave_facebookDave Halpern QR CodeLouisville Foreclosure Realtors Dave Halpern

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Rainmaker
185,585
Irina Netchaev
Pasadena Views Real Estate Team, Inc. - Pasadena, CA
Pasadena CA Real Estate

Mold is a huge issue for many consumers.  Whether or not the banks like it, home buyers expect it to be addressed.  All excellent points Dave.

Jul 31, 2011 06:43 AM #2
Ambassador
760,331
Lori Bowers
La Quinta, CA
The Lori Bowers Group

Even here in La Quinta, we are seeing more and more mold as homes age.

Jul 31, 2011 06:57 AM #3
Rainmaker
254,675
James Sanson - Ranked in the TOP 1% of Arizona
Keller Williams Realty Phoenix - Maricopa, AZ
Homes for sale in Maricopa AZ

Good stuff

Jul 31, 2011 07:26 AM #4
Rainmaker
908,388
Pamela Seley
West Coast Realty Division - Murrieta, CA
Residential Real Estate Agent serving SW RivCo CA

Dave, shows the stupidity of the banks allowing homes to remain vacant, when they could have agreed to a short sale. It's the same California, once a property is declared as having "mold", it must be remediated and then forever disclosed. Although So Cal tends to a dryer climate, homes can get mold, if not probably maintained.

Jul 31, 2011 07:50 AM #5
Rainer
158,244
Anthony Daniels
Coldwell Banker - San Francisco, CA
SF Bay Area REO Specialist

Good stuff and great picture.

Thanks for sharing it.

Jul 31, 2011 08:20 AM #6
Rainmaker
108,393
Deborah Wilson
Hackenberg Realty Group - Canton, OH
Stark County OH Real Estate

I can't tell you how many times I go down the basement of a carpeted family room and the carpet is wet and spongy and black mold is all over the walls.  I know it wasn't like that when the homeowners lived there.  The banks turn off the electricity which includes the sump pump. 

 

Jul 31, 2011 09:48 AM #7
Rainmaker
346,268
Dawn Maloney
RE/MAX Trinity Northeast Ohio Real Estate Specialist - Hudson, OH
330-990-4236 Hudson & Northeastern Ohio

Yes, it is ludicrous, but a fact of life. I have tried explaining it to negotiators, but they just do not listen.

Jul 31, 2011 12:55 PM #8
Rainmaker
1,317,476
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

An interesting post.  I have  seen a lot of foreclosure properties that have moled issues. 

Jul 31, 2011 02:55 PM #9
Rainmaker
420,636
Michelle Francis
Tim Francis Realty LLC - Atlanta, GA
Realtor, Buckhead Atlanta Homes for Sale & Lease

Dave, 

This is such a smart perspective.  It's a shame the banks aren't more intelligent about the short sales and end up losing a ton on their short sightedness. 

All the best, Michelle

Jul 31, 2011 03:04 PM #10
Ambassador
2,007,427
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Dave - A valid point, and an issue the banks would do well to consider when making decisions.

Jul 31, 2011 05:41 PM #11
Rainer
105,849
Tim Krueger
Morovish Properties - Costa Mesa, CA
I have a short sale listing that has mold let's see what's happens.
Jul 31, 2011 06:17 PM #12
Ambassador
1,951,782
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

I had a few of them.. .someone is losing out for incompetence. . .not sure if they even know it.

Aug 01, 2011 12:38 AM #13
Rainmaker
2,189,507
Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

I didn't have to see this picture before breakfast. See, the thing is mold stinks to high heaven, too. I had a short sale home listing that flooded because pipes broke in the ceiling -- they froze one winter becausae the homeowners had turned off the heat. So, it wasn't covered by insurance. I had a helluva time getting Bank of America (pre Equator days) to approve this short sale. The mold grew to the size of basketballs during this time. Squatters broke in. But the bank finally approved it.

Aug 01, 2011 02:37 AM #14
Rainmaker
316,101
Sandy Acevedo
951-290-8588 - Chino Hills, CA
RE/MAX Masters, Inland Empire Homes for Sale

Lack of care or the lack of ability to monitor the vacant homes by the banks are causing huge problems and costing money and there is no relief in sight.Yikes!

Aug 01, 2011 04:09 AM #15
Rainmaker
525,189
Dave Halpern
Keller Williams Realty Louisville East (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

Similar experiences from commenting Realtors nationwide:

Michael from Pasadena, CA

Irina from Pasadena, CA

Lori, From La Quinta, CA

James from Arizona

Pamela from Temecula, CA

Anthony from SF Bay

Deborah from Ohio

Dawn from Hudson, OH

Joan from Southern New Hampshire

Michelle from Buckhead, Atlanta, GA

Christine from Costa Mesa, CA

Tim from Newport Beach, CA

Fernando from Maryland and Virginia

Elizabeth from Sacramento, CA

Sandy from Oxnard, CA

So we have Realtors from coast to coast who understand how the delays by the banks cause tremendous losses to the banks themselves. How is it the banks don't understand this and take measures reduce these losses? These delays and resulting losses are not the seller's fault. Realtors are trying to help the banks reduce their losses.

 

Aug 01, 2011 10:28 AM #16
Rainmaker
710,551
Pacita Dimacali
Alain Pinel - Oakland, CA
Alameda/Contra Costa Counties CA

Why, oh why don't they see this?

We see this so often...short sales take forever. Buyers walk. Sellers give up. And banks foreclose, and sell the property for much LESS than what they could have sold it for in a short sale.

What a waste of time and effort

And what a loss!

Aug 08, 2011 06:00 PM #17
Rainmaker
508,942
C. Lloyd McKenzie
Albuquerque, NM
Living Albuquerque

Congratulation on being Featured!  

One has got to consider the Banker's mindset.  It's always the bottomline for them...even when they are wrong.  There is an Org Chart that they strictly adhere to.  If you are not dealing with the correct level, nothing makes sense

Aug 16, 2011 04:38 PM #18
Anonymous
Michael Murphy

Their  is a new nanotecnology that is non toxic that kills  all mold contamination in  a house and cost less than half the typical cost of traditional methods. Tear down and recontruction are reduced by 80% even rugs and drapes are not required to be removed...what normaly cost 20K for mold remediation of mold can often be done for 5 to 10K ..It is EPA approved totaly safe to humans and  people can  move in  the same day

Apr 13, 2012 02:54 AM #19
Rainmaker
525,189
Dave Halpern
Keller Williams Realty Louisville East (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

Michael,

Thanks for adding your knowledge to the conversation.

Apr 13, 2012 03:49 AM #20
Rainmaker
1,483,071
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

The problem with nanotechnologies that Michael( #19) mentioned: seems it is not available. I hoped to find someone who does it in L.A./CA~ seems no one does it. So, the question is: is it as good as they promise or it is just a 'promice'?

Apr 27, 2014 04:55 PM #21
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