Saturday, January 14, 2012

Damage to a House After Foreclosure - Who is Responsible to Clean it Up?

When buyers buy a foreclosure home, they should not be surprised if the house is damaged or in a state of disrepair. Even if former owners did not cause any damage, banks do not take care of properties while they have possession, which means that the health may deteriorate rapidly. But purchasers often have no one to hold accountable for damage to the house, as the bank protects itself and former owners are no longer responsible for the house after the foreclosure.

If a new owners bought a foreclosed house from a mortgage business in "As Is" condition, then there may simply be no one to sue for damage to the property. It will be pretty clear to a judge from the as-is clause in the real estate sales compact that the buyers purchased the house insight that there may be severe problems with it and that the bank was not taking responsibility to fix these problems before the sale.

Clean House

If the house was not bought in as-is condition, then the new homeowners would have to sue the mortgage business that the asset was purchased from. The bank was the former owner of the house due to the transfer of legal ownership from the foreclosure sheriff sale and was responsible for upkeep and manufacture sure it was in salable condition. This makes it the only party to sue for damage to the house, but only if the asset was not sold in as-is condition.

But there is itsybitsy opening the new owners would have any case against the former homeowners who lost the house to the foreclosure process. And anyway, they went straight through foreclosure and lost their home -- it is unlikely that they will have much money to procure for repairs to a asset they no longer own. Furthermore, they can not even borrow money to pay the judgment against them if they are sued for damage they may have caused before they moved out.

The foreclosure victims have no responsibility for the house after their ownership interest has been transferred at the county asset auction. At that point, it is up to whoever purchased the asset (usually the bank) and that now owns the house whether to disclose any problems before the sale or have them repaired.

Since banks do not care to do much with foreclosures, though, it is more likely it will sell the asset in as-is health and let the purchasers know the lender will not take any responsibility for anything wrong with the house. This is one exquisite hypothesize why foreclosure buyers regularly have their own home inspection done before end on the house. If there is a lot of damage, whether the price will be negotiated down to take into inventory mend costs, or the buyers may simply walk away from the deal.

If the lender does not sell it to the buyers in as-is condition, then it might be responsible for manufacture any repairs to the house for damage that was never disclosed to the purchasers while the sales process. But the owners would have to sue the bank responsible for disclosing the damage -- not the former owners possibly responsible for causing the damage.

Damage to a House After Foreclosure - Who is Responsible to Clean it Up?

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