So we were having a discussion about what we would all do if we were unfortunate enough to have our homes go into foreclosure. I asserted that all the appliances and even window blinds would still be my property. I would be allowed to keep my washer, dryer, fridge, dishwasher, blinds and even any fancy light socket covers I had installed.

I would not have access to the stove, built in microwave and hood, copper wiring, carpet or fence material.

So what is the law or generally accepted rule for what I bank owns when the home is foreclosed on?

  • 1
    Note: this is hypothetical, nobody in the discussion was being foreclosed on. – MrChrister Nov 20 '10 at 17:35
  • So if a dishwasher is permanent and you recently replaced it after 10 yrs of living in the residence, that's now owned by the bank? – user32158 Aug 11 '15 at 22:12
up vote 11 down vote accepted

My understanding is that bank would generally have title to the permanent fixtures in the home, and that the prior homeowner would have the right to keep temporary fixtures, decor, and other personal property. Most things are clear-cut: a toilet is a permanent fixture. A shower curtain is not.

For some items that aren't so clear-cut, it depends on the way things are handled in your jurisdiction. In some areas, appliances like washer/dryer/fridge are traditionally bought and sold with the house. In those areas, those appliances would be considered permanent fixtures of the property. In other areas, the appliances don't usually convey with the house, so they wouldn't become the bank's property either.

Many people make improvements like upgrading shower heads, adding a chandelier, or installing fancy light socket covers. You're probably within your rights to take those back as long as you install a replacement, and those replacements don't have to be very nice.

It's sadly become common for homeowners to strip a home that's in foreclosure, taking permanent fixtures when they leave. Those items are technically your property until the place is actually foreclosed. If you happen to sell your fridge on Craigslist for $200, there's not much your bank can do.

After foreclosure, the new owner's top priority will be to get you out of the house quickly and quietly. I've heard that they'll actually offer cash for cooperation, so that the resident can leave with some dignity and have some cash to start a new life. The bank isn't going to go after you for the curtains -- it's relatively unimportant, it's not worth their time, and you probably wouldn't be able to pay them back anyway.

Disclaimer: I'm not a lawyer nor an accountant. Everything I just said is probably wrong. :) I learned all of this last year when I bought a house that had been foreclosed and was "stripped" by the previous owner.

  • 2
    Further, if the house is underwater, the mortgagor is responsible for the deficit; stripping the house reduces the resale value, so increases that deficit. – Pete Becker Aug 11 '15 at 22:46
  • AIUI in the US it varies between states whether or not a mortgage lender's recourse is limited to reposessing the house. – Peter Green Nov 19 '16 at 1:05

Basically what you said: Things permanently attached to the home stay; personal property goes.

If you upgraded a fixture and still have the old fixture, you can swap them out as long as the old fixture still functions.

  • So is a dishwasher is permanent? – MrChrister Nov 21 '10 at 1:56
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    It should be. If someone stripped it, I'd sue them in small claims. The problem is that people who stop paying their mortgage are bad debtors, and you're unlikely to get anything out of them. – duffbeer703 Nov 22 '10 at 15:01

That is incorrect. Very often, people who stopped paying their mortgage were forced to do so by their lender. They make you fill out a fancy packet if you lose your job or something life-changing happens which renders you unable to work and you require short-term help. Well that happened to me when I needed only a month of assistance. When I was ready to resume payments, they told me to wait the six-month mortgage assistance period before paying again on my mortgage. Then the same thing keeps happening, until you've lived in your home not paying anything for 2 years because they won't let you !!!!

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    This does not appear to be an answer to the question posed here. – ChrisInEdmonton Nov 17 '16 at 16:20

protected by Dheer Dec 11 '16 at 10:47

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