You’re a few house payments behind, and one day you find that the front door lock and deadbolt have been drilled out and replaced with new ones and the garage door opener has been disconnected. Now you can’t even get into your own house! Who is responsible for this? This must be illegal, right? After all, you still own the house.
Before you call the police (who will explain to you that they can’t do anything about it), you’ll need to understand that your lender isn’t trying to deny you access to your house. Here’s an explanation of what happened and why:
The Deed of Trust (part of the mortgage documents from the lender) that you signed at closing or when refinancing has a paragraph that states something like, “If the Borrower fails to perform the covenants and agreements contained in this Security Instrument…” (i.e. making the payments), “…or Borrower has abandoned the Property, then Lender may do and pay for whatever is reasonable or appropriate to protect Lender’s interest in the Property… including securing and/or repairing the Property… including but not limited to… entering the Property to make repairs, change locks, replace or board up doors and windows, drain water from pipes, …” You remember reading that, right? (Let’s be honest now…)
So the Deed of Trust, which identifies the property as collateral for the loan, allows the lender to change the locks. The lender typically contracts out to a national field service company which contracts out to a local independent contractor to change out the locks. Some field service companies have a policy to contact the real estate agent if there’s a sign in the yard and offer them a new key for the key box, and other companies have a policy not to contact the agent (which is a bad business practice in my opinion). The problem is that if the field service person calls the agent, it’s after the lock has been changed and damage done to the door and/or frame. Also, the field service person will often times keep the old hardware (which is usually nicer than what they replaced it with). I had a situation recently where the field service person removed a $150 lock set from the door, replaced it with a $20 doorknob, and refused to return the old lock set to the owner.
What happens when they change the locks and don’t contact you or your real estate agent? Usually, calling your lender will get you the information needed to gain possession of the new key. However, some people just drill out the new lock and install a different one. This generally doesn’t take a locksmith—The doorknob can be easily removed once the door is open and replaced with another cheap model from a local hardware store. The next time the field service person goes out to check on the property and their key doesn’t work, they’ll typically call the agent’s phone number on the yard sign. If that happens, just remember that they were just following orders from the field service company and they often times may not agree with all of the company’s policies. They’re usually willing to work with you if you treat them with respect. Also, keep in mind that the local field service person may have to cover the cost of a new doorknob out of their own pocket if you drill out their lock. This may make it more difficult to get your old doorknob and lock set back from them if it has some value.
The lender will take measures to secure the house if they believe it has been abandoned. They need to protect the asset that is securing the loan. If you mention to your lender that you moved or if your house looks like it could be vacant, the lender will generally take measures to secure the house. To assure that this doesn’t happen to you while you’re still living there, here are some things to consider:
- Make sure the lawn gets mowed occasionally,
- Pick up flyers and newspapers from the porch and driveway,
- Park your car in the driveway instead of the garage,
- Think of anything else that could make the house appear to be occupied.
If you have already moved, locking the doorknob lock and leaving the deadbolt unlocked could prevent the risk of damage from drilling out the deadbolt. However, you may not want to do this if you still have valuables in the house or you’re in an area where the burglary risk is high. A damaged door could be a turn-off to some buyers if the house is otherwise in good condition, as it’s one of the first things they see.
The bottom line is that there’s very little you can do to prevent the lender from changing the locks if your house is vacant and you’ve fallen behind on your mortgage payments. However, knowing the process and how to deal with it may help reduce stress levels if it happens to you.
Authored by David Monroe, Realtor and Pre-Foreclosure and Short Sale Specialist.
Access Seattle area short sale help and foreclosure resources including selling in foreclosure, and 8 Ways to Avoid or Stop Foreclosure.
Copyright (c) 2009 by David Monroe (Home4Investment Team at Keller Williams Seattle Metro West).
The Bank Locked Me Out Of My House! Should I Call The Police?