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Banks Announce Tougher Background Checks on Foreclosure Contractors

By Mike Wheatley | February 4, 2014

Following thousands of complaints over alleged break-ins and hundreds of consumer lawsuits, banks are set to announce tougher background checks for those hired to watch over properties going through the foreclosure process.


photo credit: BasicGov via photopin cc

Complaints and lawsuits accuse some handymen and home inspectors who are hired by banks to look after the properties of breaking into still-occupied homes and stealing valuables. Many of the homes involved are in some stage of default, but the home owners are still in possession of the home.

In the cases reported, contractors have been accused of ignoring “obvious signs of habitation, kicking down doors and crawling through basement windows in order to gain access, then changing the locks,” The Huffington Post reports. “In some cases, they are also accused of helping themselves to valuables found inside.”

A new screening system that banks are planning to implement is aimed at checking contractors for past criminal convictions, such as theft or fraud. In several of the consumer lawsuits, a background search of the contractors who were accused of the alleged break-ins and thefts revealed lengthy criminal pasts.

"The intent is to give communities a high level of confidence that the people walking around in homes are not going to cause problems," says Eric Miller, the executive director of the National Association of Mortgage Field Services, the trade association that is helping to create the new standards.

Miller says the purpose of the new guidelines will be to prevent contractors with recent criminal convictions from entering such properties. The same guideline would apply to all foreclosure contractors, even those who are hired to mow the lawn.

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at [email protected].
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