Following the recent paperwork issues - specifically "robo-signing" documents without reading them - that plagued the banking industry's handling of foreclosures, the last thing the financial sector needs is another scandal. However, yet another black eye has appeared in the ongoing foreclosure saga: bank break-ins.
A bank break-in occurs when bank representatives enter a property, thinking they have the right to enter the property, when in reality they do not.
There are legitimate reasons for a bank to enter property. Most often, banks send representatives to properties when the property owner is in default of the loan or if the property is abandoned. Usually, a representative from the bank, or a third-party contractor the bank hires, will enter the property to change the locks, keep pipes from freezing or to perform other maintenance tasks. Banks do this in order to ensure that no vandalism occurs on the property - banks can be held liable if vandalism or damage occurs.
More and more homeowners or mortgage holders are suing banks for illegal bank break-ins, however. As reported by the New York Times, there are complaints of banks entering the property of homeowners who were current on their payments, had completely paid off their homes or were in the process of a mortgage modification with the bank. In a few instances, the banks had entered properties after wrongfully foreclosing upon the properties or failing to give proper notice to the homeowners that they were being foreclosed upon.
More disturbingly, the New York Times reports that some banks or their contractors had thrown out the personal property of homeowners without alerting the homeowner that such action was being taken. There were also reports of properties being "ransacked" and personal items missing, such as electronics.
Bank break-ins may just be the latest symptom of a foreclosure process in distress. If you face foreclosure or feel buried under a mountain of debt, bankruptcy may offer you options to keep your home and find a way to a new beginning. Speak with an experienced bankruptcy attorney to discuss your situation and learn of your options.