REO evictions
It takes a special kind of person to deal with the headaches of evicting a tenant! (That’s why you love your job though, right?)…
Most people would cringe at the idea of knocking on a door, telling a family they need to move out within xx days…but as an REO agent, that’s part of your job. When a bank takes back a property as REO, it’s one of the first steps they need to take to properly market the property.
Emotions can run high – you’re kicking a family out of their home, and they often have no alternative in mind. In the case of a renter, your visit to evict them may come as a total surprise. They may not even know their landlord lost the property! If it’s a homeowner, they may be difficult to work with – there may be sentimental value attached to the home, or they may hold a grudge against the lender. Remember, it’s a stressful time for the tenant/homeowner so the situation needs to be handled with the utmost care.
The most expensive (as well as time-consuming) way to get rid of a tenant or homeowner is the old-fashioned court eviction. There’s a long, drawn-out court process involved and with today’s housing environment, it can take a very long time.
Cash for keys
Therefore, the most common way to evict a tenant is the “Cash for Keys” program. The bank pays a certain amount of money to the tenant/homeowner, if they agree to move out within a specified time period. For instance, the bank may offer the tenant/homeowner $1,000 to move out within 1 month.
Some banks offer differing amounts of money, depending on how fast the tenants/homeowners move out. For instance, they might offer $1,500 if they move out within 2 weeks, $1,000 if they move out within 4 weeks, $500 if they move out within 6 weeks, and nothing if they move out after that.
Vacant Properties
Sometimes, the property is already vacant and the agent has to perform a “Personal Property Eviction”. It sounds funny because you’re evicting property instead of a person, but sometimes it’s necessary. There are different guidelines that vary by state – in some states, there are laws that give tenants/borrowers a specified period of time to collect their personal property. Other states also have statutes that require specific handling of personal property left behind.
Normally, the asset manager will ask for photos of the personal property. Once all time periods/statutes have passed, any remaining personal property would be evicted and/or trashed out. Anything of value is often stored in a storage unit.
Tags: cash for keys, cfk, homeowner, personal property, reo eviction, tenant
How-To/Instructional | RobH January 27, 2011
6 Comments to “REO evictions”
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By Mary Poland-Smith, January 27, 2011 @ 9:36 am
I have had to do Evictions many times. Each situation is always different. Sometimes a little scary. Former Owner Occupants are very good at “hiding”.Blinds are drawn tight, nobody will answer the door but usually a vehicle is in the driveway. I do feel compassion for them especially if children are involved. I know they “know”. The Lender has probably sent a minimum of 3 notices to them that they must vacate the premises OR Formal Eviction will happen..Sheriff, Locksmith, Agent, etc..I send 3 letters, all saying the same thing. I hand deliver(front door or under it),regular mail and finally certified mail. I also call the utility companies to verify services are on. Most of the time I can find out if a disconnect has been ordered for (1) non-payment or (2) by the Occupant. It all helps. I have found the Cash for Keys program to be the most effective means of gaining access and getting them out of the home with no damage to the premises. We don’t pay unless the home is totally empty of trash, furniture and is broom swept clean. I make that very clear, verbally and in the letter(s).I don’t have quite the same problems with Tenants although I still send the letters, knock on the door,etc. Tenants are usually not too surprised because most of the time the Former Owner has been getting swamped with mail(past due notices, etc.) from their Lender and has not picked the mail up after the Tenant calls. Some Banks are starting to work with the Tenants that are still on lease but most will move on if you offer Cash for Keys.
It’s not easy being “the bad guy” and I always tell the people that I am dealing with that I am very sorry but I will work with them as much as “my” employer will allow . It usually works.
You can do your job and still be decent about it. I always remember that it only takes a few wrong steps and i could be in their shoes but my motto is “Bad news can’t wait because until you know the problem you cannot begin to fix it”.
By RobH, January 27, 2011 @ 10:10 am
Thanks for your comments Mary, very helpful and insightful. I like what you said “You can do your job and still be decent about it”. I totally agree with that.
By Laura Morton, March 19, 2011 @ 11:32 pm
Eviction is hard for all involved. However, you can still do the eviction and leave the family with their dignity intact. Cash for keys works. It gives the homeowner a chance to start a new life with a bit of cash.
By Tom, May 10, 2011 @ 4:22 pm
I know exactly what you’re talking about. Nobody on either side wants to go through with the eviction, but its a necessary process that must be endured when the situation arises. The Cash for keys is a decent way to help out the home owner and still get them out of the house. The benefit comes from that little bit of cash that is needed for first months rent somewhere else, or even just to cover the moving expenses.
By RobH, May 13, 2011 @ 3:18 pm
Laura, the fresh start is so helpful – many times the evicted family is feeling helpless and like you said, they need to keep their dignity intact. The cash for keys offer helps them do that.
By RobH, May 13, 2011 @ 3:20 pm
Tom – appreciate your thoughts, I agree with your comment 100%.