Foreclosure in 96761>Question Details

Tanya Larsen, Home Buyer in 96761

If I put an offer on a home that's in short sale. Can it still be auctioned at it's scheduled date?

Asked by Tanya Larsen, 96761 Sun Jun 20, 2010

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Be prepared for anything in a short sale. If you do have a signed contract, it is probably subject to the lender agreeing to the terms (accepting an amount lesser than what is owed). So unless they have agreed to the terms, they can do whatever they want. Sometimes the loss mitigation department is not in communication with the foreclosure department and that is where the mis-communications can occur. Lenders nowadays don't want to foreclose. It's more costly to them than a short sale. Have your agent contact the listing agent to be certain that the foreclosure department is aware of the pending sale. That is my advice. Good luck.
0 votes Thank Flag Link Sun Jun 20, 2010
Aloha Tanya - the answer is unfortunately YES, and it happens more than anyone wants to admit, including the banks. Most of the time, the foreclosure department and the short sale department do not talk with each other, which can make for tons of confusion and the property can be sold at foreclosure even as you are negotiating with the bank's other hand for the short sale. We have found the only way to be assured this will not happen is to contact the lawyer who conducts the auction - if your agent or the listing agent can't reach them beforehand, then both agents should plan to attend the foreclosure auction in person - usually they can get a stay of foreclosure by showing up and presenting the lawyer with a fully executed copy of the purchase contract. Good luck - short sales can take a lot of patience! Warm aloha, Katie Minkus, Broker-in-Charge, Hawaii Life Real Estate Services, LLC.
1 vote Thank Flag Link Mon Jun 21, 2010
A short sale can be like a good mystery novel. You never know what might happen when you turn the page. Can be some good deals out there....but not for the faint of heart. I see this question was posted over a year ago. Hopefully you have already closed on this sale.
0 votes Thank Flag Link Mon Sep 19, 2011
I even seen foreclosures on short sale properties that have been closed, recorded and title given to the new owner. Now thats communication at it's best, way to go short sale and foreclosure departments. Really; I have seen this several times on Maui aloha Jeff

Follow my blog for up to date info on foreclosures!
0 votes Thank Flag Link Wed Jun 23, 2010
Tanya we are finding that with an accepted offer the bank will many times postpose the foreclosure and allow the sale to record. Communication is the key between the listing agent and lien holder (bank) for short sales to be successful. Nancy Montoya 250-5073
0 votes Thank Flag Link Mon Jun 21, 2010
Hi Tanya
Yes, the property can be auctioned off despite one or multiple offers. The listing agent or homeowner can get the foreclosure delayed if there is a legitmate short sale offer in process. If you have your offer in with a listing agent that has not done shortsales or is relying on the escrow company to complete the process, your chances of an approved short sale are diminished.....
On Maui you will not be able to stay a foreclosure by showing up at the auction with your purchase contract. The auction proceeding as scheduled is notice that the bank has rejected the short sale offer(s).
I have had several short sales where we delayed the foreclosures for 2 years, with 8 different buyers.
I have had homeowners contact me that were a week away from foreclosure and we were able to get the foreclosure delayed and offers submitted. Ultimately, banks do not want to foreclose.
It comes down to the listing agent, their knowledge, and comittment to complete the short sale. If the listing agent hasn't closed any short sales or has placed the responsibility on the escrow officer, your chances are not so good.
0 votes Thank Flag Link Mon Jun 21, 2010
If you don't have an executed contract YES IT CAN best keep looking for other properties to purchase UNLESS you hear back from this lender .

Some lenders never respond
Web Reference:
0 votes Thank Flag Link Sun Jun 20, 2010
The delay of the auction will largely depend on your offer. Was you offer enough to interest the bank enough to stop the sale? A study of the current market value and your offer price should give you the answer you seek.
0 votes Thank Flag Link Sun Jun 20, 2010
Hi Tanya,
If a buyer and seller have a binding contract to sell the property, that will usually delay the foreclosure auction. Each bank handles things a little differently though, so it all depends on which bank you're dealing with and their procedures.
Purchasing a home by way of a short sale can be very frustrating for everyone. You might want to talk to your agent about this, and even get some legal advice from a lawyer.
Best wishes for a quick sale!
Georgie Hunter

Georgina M. Hunter "Georgie" R(S) e-Pro SFR
Jim Sanders Realty Inc. Paia Maui HI 96779
cell: 808 283-0635
toll free fax 1-888-875-1918

"I want to help you reach your Real Estate goals."
0 votes Thank Flag Link Sun Jun 20, 2010
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