Not sure where to post this. Purchase house at auction, evicted former owner, former owner removed appliances and kitchen cabinets. Do we have a claim for damages against former owner for damage caused to property. Insurance company says, no claim for damages against them as it is theft and theft is not covered.
Thank you for any assistance.
You owned the home as of 8am the day of auction. If you have evidence the damage occurred after that, and that they did it, then you should have a good case. Otherwise this is an unfortunate part of the territory with auction investing.
Usually when first contacting owners, it is a good idea to let them know you own the property as of 8am the day of sale per Civil Code 2924, and that they will be responsible for rent and any damages from that point forward. Soften this up with an offer of cash for keys.
If you have someone who is clearly going to be a fight, it doesn’t hurt to have an attorney draft a letter to the occupant putting them on notice that removing any fixtures, even if they purchased those fixtures after originally purchasing the home, is theft and will be prosecuted to the full extent of the law.
One of my greatest fears is that a soon to be “evictee” will take miss-placed retribution by damaging the property or stripping out fixtures/appliances. To confirm the property’s condition, I want to be proactive by taking pictures of the house (both exterior and interior) promptly after buying at the auction? In cases when you know the property is occupied, do you recommend knocking on the door almost immediately after you’ve bought at the steps? … or do you recommend waiting until after you’ve recorded the deed? … My plan is to, immediately after the “steps buy”, knock on the door to discuss a “cash for keys” exit plan and to convey that per Code 2924, I now own the property and I would like to enter the property and document the condition by taking pictures here/now. Would this be a violation of the tenant’s (former owner’s) rights? Do I technically need their permission to enter? For practical and personal safety reasons, I would not enter without permission, but I want to be accurate in how I explain my rights to document the property’s condition and when I am legally allowed to do so. I know that a lender (under a deed of trust) has the right to inspect a property with proper notice. Do I need to give the former owner/tenant (soon to be evictee) similar notice before going inside to take photos? How much notice? 3 days?
Your best bet is to reach out to the occupants to notify them to see if they have a plan to vacate or what their intentions are at that point. Although you can give them notice that you would like to inspect the property (typically 24 hours advanced notice) they do have the right of possession and can deny you entry. It is always in your best interest to find a way to work with them. You may ask permission to take photos and see if they will allow you in. If you entered without permission they could call the police since you would be breaking and entering. This could also create additional problems if you do end up having to evict them in a formal eviction. The right of possession applies to owners as well as renters. Keep in mind that if you are negotiating an amount to offer for Cash for Keys maybe you can ask them to inspect the property and take some photos so that you can determine what the amount would be. The key is to get them to work with you. If you are not the type of person that can put people at ease then maybe you should hire a Realtor or have someone else contact them.
Thanks Michelle … good points. I’m usually accused of being too much of a push over … I’ve heard about other investors who are much more “in your face” about inspections and the eviction process. I’ll likely strike a balance, keep within the legal bounds and be fair with cash for keys $ offer. Notwithstanding $4Keys agreement, I’ll also file a UD in case things get dragged out beyond agreed upon move out timeline.
It is always good to start out trying to be nice. You never know until you knock on the door if you will see a little old lady or a pit bull and a shot gun. Either way I have always found that if you treat people with respect and explain the process and what has happened you can usually find a way to work with anyone. That said, you always have to be prepared to use any legal means to get possession of your property. I started my real estate career in property management 20 years ago. In the beginning I believed every sob story and would try to give people the benefit of the doubt. Most times I was the one that got burned. So remember that you also have to be firm. You sound like you have a good handle on the situation.