Nice Home. Where’s the Rest of It? Stanley Fosha, a real estate agent, in the stripped kitchen of a foreclosed home in Avondale, Ariz. By JOHN COLLINS RUDOLFPublished: December 22, 2009 The author of the Craigslist posting in Las Vegas made no effort to disguise his or her intentions.Skip to next paragraph MultimediaSlide Show Foreclosure, Then a Shell “Stripping House — Before Foreclosure,” the ad declared, offering potential buyers the cabinets and countertops, the sinks and toilets, the doors, the appliances, the sprinklers. Even the palm and citrus trees in the yard were for sale, with a catch.“You dig,” the author advised.In Nevada and other states hit hard by the housing crisis, stripping fixtures and appliances from homes in foreclosure has become commonplace. Craigslist, the Web site for classified ads, functions as a bazaar where stripped items are sold openly. Often, the stripping is not done by strangers. It is done by the owner, just before the bank forecloses on the mortgage and takes the property back.If that seems like a situation tailor-made for the police, it is — at least in Arizona, where the Federal Bureau of Investigation has used Craigslist to arrest a handful of people for stripping homes and trying to sell the goods, charging them with felonies under a state fraud statute.In other parts of the country, however, the police are stymied. As it turns out, several troubled states, like Nevada, have no specific criminal prohibition against stripping fixtures from a property before foreclosure. Mortgage contracts do prohibit such behavior, requiring that homes be kept in good order. But violating those provisions is a civil matter, not a criminal offense.“If the homeowner sells the components to the house while they still own the house, that’s not a crime,” said Officer Bill Cassell, a spokesman for the Las Vegas police.So too in Florida, another state swamped by foreclosures. Several prosecutors and police agencies there said that unless laws were modified, such behavior would have to be sorted out between borrower and lender in civil court. Even in Arizona, which has an applicable law and where thousands of homes have been stripped, convictions are rare. There, to make a charge stick, law enforcement basically has to catch people in the act, said Julie Halferty, a special agent with the F.B.I. in Phoenix and head of a mortgage fraud task force.“This window of time can be quite short,” Ms. Halferty said in an e-mail message. “Once homes are abandoned, arguably any number of people can get access and strip the fixtures.”Statistics on foreclosure stripping are elusive, and experts disagree on just how widespread the practice is. Yet even those who play down the number acknowledge that the problem is serious, particularly in housing boom-and-bust areas like central Arizona, southwest Florida and the Las Vegas region.“Clearly it’s happening, and it’s happening with some frequency,” said John A. Courson, president of the Mortgage Bankers Association.Banks are largely powerless to stop a homeowner determined to strip a property. Lenders can pursue such homeowners in court, but the expense and difficulty typically outweigh the gain.Though the efforts are scattered and feeble, law enforcement officials are trying in places to stop the practice. Last April, Randolph Guzman, 42, of Phoenix, was arrested while trying to strip appliances and fixtures from an investment home he owned, shortly before a bank was to hold an auction.Mr. Guzman posted an ad on Craigslist and found a married couple interested in buying the air-conditioners, kitchen cabinets, ceiling fans and a light fixture for $2,300. They met at the house, in Surprise, a distant Phoenix suburb, and Mr. Guzman accepted a down payment of $400 in cash. Then he was handcuffed and read his rights. The couple, he disc
overed, were police officers working undercover with the F.B.I.Mr. Guzman pleaded guilty to defrauding a secured creditor, a felony. If he completes 18 months of probation, the charge will be reduced to a misdemeanor, he will serve no jail time and pay only a few hundred dollars in court fees.David Michael Cantor, Mr. Guzman’s attorney, called his client’s offense minor when compared with the thousands of homes that have been thoroughly stripped by their former owners. “I understand why they want to crack down on this stuff, but Randy is small potatoes,” Mr. Cantor said.After the F.B.I. publicized the arrest of Mr. Guzman and a handful of others caught stripping homes, the number of ads for stripped goods on Craigslist in Phoenix dropped sharply. “That was our objective — to get the word out that stripping a foreclosed home is illegal,” Ms. Halferty said.