Happy Halloween! Are You Living Next Door to Zombies?

Zombie houses, in case you hadn't already guessed, aren't populated with actual zombies. They could be though, if zombies existed, because they're empty.

A zombie foreclosure happens when a lender initiates the foreclosure process and the soon-to-be previous owners leave the property vacant, but the creditor never follows through with the rest of the process.

Does this mean the original borrowers get to keep the house? Not really, and a zombie foreclosure can lead to even more problems with credit and finances later.

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How does a zombie house happen?

The undead don't just move in. You won't see a moving truck, and they won't come over to say hello.

Once a lender initiates a foreclosure, the owners may want to leave as soon as they can. They're leaving a home they couldn't manage, and they may feel like the sooner they get out, the better. A house ends up a zombie when the bank holding the mortgage doesn't follow through with the foreclosure.

Why does it happen? Sometimes, the lender decides it isn't worth it, if the home is in a low value area and they won't be able to resell it for any significant amount of money. Maybe they think the borrowers might be able to come through with some of the money they owe, or maybe they're just slack.

In most areas, there's a limit to the amount of time that can pass between the initiation of a foreclosure and its conclusion. The homeowners may not be aware they still own the house.

How does a zombie house hurt the neighborhood?

If you're trying to sell your own house, you see your neighborhood in a whole new light.

Potential buyers want to see a street lined with houses that are well kept and similar in value to yours. Manicured lawns and fresh paint jobs let people know the neighbors care about where they live. A few junky looking places can bring the whole neighborhood down.

If the lawn hasn't been mowed in a while, wildlife could go, well, wild. Sooner or later, those critters will get bored or hungry, and visit you.

Do you want to share your backyard barbecue with a raccoon or a family of possums? We don't, either.

An abandoned house can be an actual hazard in other ways. Squatters might find it and move in, which can lead to a less safe environment.

And the kids? No matter how many times you tell them not to do something, they can forget. Especially if everyone else is going into the creepy place across the street—or someone dares them to go first.

Faulty wiring could cause a fire that spreads if there's no one home to call 911. A burst pipe could damage your foundation if it's close enough and no one knows to fix it. A large tree that hasn't been pruned can fall on your house during a big storm. All of the things resident homeowners monitor will go unchecked. A house with a zombie title can go unchecked for years.

How does a zombie house hurt the owners?

The owners might not know they still own the house.

If your house is going into foreclosure, your credit is already taking a big hit. If you aren't there, and haven't left a forwarding address, the bills could be piling up.

As long as your name is on the title, you're still responsible for taxes and any other fees. If you live in a neighborhood governed by a homeowners association, they may be able to fine you for not keeping up your house and lawn. When those bills go unpaid, your credit score will take an even bigger hit.

If your lender or bank has started foreclosure, don't walk away, no matter how tempting.

You may be under a lot of stress, worrying about where you'll go and if you'll ever be able to get another mortgage, but not making sure the title has been transferred to the mortgager before you leave will make things worse. To make sure the title has been transferred, check the county recorder's website.

If you don't find what you need online, call the office or pay them a visit.

How do you kill a zombie?

If you suspect you live near a zombie house, what's the best battle plan?

Start small and go higher. If you have an HOA, contact them and let them know about any visible problems with the house. Be prepared to tell them how long you believe the home has been vacant.

If they can't do anything, check the county recorder's website to see who's listed as the owner. If the bank is the owner, get in touch with them and ask what's going on with the property. If the homeowner is still listed, find out what the laws are in your area. If too much time has passed, usually 90 days, you can petition a court to force the foreclosure. 

Stay cool, though, because you're going to have to deal with some beaurocracy. The best way to get people to help you, especially if they don't have to, is to have your facts straight and just be nice. It may help to have your non-zombie neighbors in your corner. Fighting the zombies as a group is always a better bet.

Happy halloween—here's to keeping the zombies at bay!