So sorry to hear about this. And the last thing you need is for someone to call you a loser. You are not a loser, you are the victim of a bad real estate transaction. You can try speaking to an attorney but any knowledgable Realtor will tell you that this will be a time consuming and expensive process to go through and even then you are not guaranteed any reward. I wish there was an easy fix for you but since you have so much emotions involved in this, it wont be easy. I suggest you find a new Realtor who is honest AND knowledgable about not just Real Estate practice but also Real Estate Law. Good luck dear. :)
IMHO: If all Realtors were this honest with their clients regarding the odds of actually closing a short sale (yes I know they close, I have closed them after months of game playing) and all but refused to play the banks short sale game and only offered on already bank owned properties, the market would be healthier and the banks could not get away with the games they are playing with people's lives. As one of my clients put it very well., " the banks have a right to conduct business and make money but they do NOT have a right to TORTURE people or ruin their lives!"
This is unfortunate situation, unless you have fulfilled all the contractual obligations, your ptions are very limited. As a practical matter it is very difficult to force a seller to sell if circumstances dictate. The seller may be responsible for damages to you and this is a matter for your agent and attorney.
The notable thing here is that YOUR agent should have prepared you for this possibility. This is one possibility and is more common these days, than one might think. Once the seller knows what the bank's bottom lines is, they evaluate their potential liability and somtimes that means changing direction.
If it is true that the seller is going to file bankruptcy, it is curious that the seller wont continue to move forward. Get your agents broker involved and keep a dialogue going, maybe there is still a chance.
Take a look at this link about filing bankruptcy to avoid foreclosure http://www.nolo.com/legal-encyclopedia/article-29631.html
Scroll down to where the question is asked about taxes
"Canceling tax liability for certain property loans. Thanks to a new law, you no longer face tax liability for losses your mortgage or home-improvement lender incurs as a result of your default, whether you file for bankruptcy or not. This new law applies to the 2007 tax year and the following two years. (See the blog post New Tax Break for People Who Default on Their Mortgage.)
However, the new tax law doesn't shield you from tax liability for losses the lender incurs after the foreclosure sale if:
the loan is not a mortgage or was not used for home improvements (such as a home equity loan used to pay for a car or vacation), or the mortgage or home equity loan is secured by property other than your principal residence (for example, a vacation home or rental property). This is where Chapter 7 bankruptcy helps. It will exempt you from tax liability on losses the lender incurs if you default on these other loans. For more information on Chapter 7 bankruptcy, see the Chapter 7 Bankruptcy area of Nolo's website."
I find it terrible that a seller would do that at the last minute.
The short pay benefits the seller much more than the buyer.
It sounds to me as though the seller is doing everything just to try to hold on to their home just a little longer.
This is a sad part of Real Estate.
Sometimes deals fall out at the last minute.
I know your anxiety.
I hope you push fourth and find a better home.
I wish you the very best.
So Cal Homes Realty
CA DRE License 01312992
Graduate REALTORÂ® Institute,
Real Estate Masters,
Certified Distressed Property Expert,
I just went through this with a buyer who had simultaneous offers one REO and offers accepted by the seller on two short sales, all made right at year end 2009. In two weeks the REO got an over-list bid my client could not match; about 6 weeks after offering one of the short sales also got an offer higher than my client could match; today we were told that the lender will give us written acceptance on the third short sale offer next Friday. I will not believe even that until we see it, and won't rest easy until it actually closes, but the point is my client was better off to have made three offers than wait on one at a time...certainly for eight months.
it is not the end of any thing...it is the begining of another house hunting...FEEL SORRY FOR PEOPLE LIKE YOU WENDY....WELL WHAT CAN I SAY...thanks anyway!
Full Time Top Sales Agent
Specializing In Co-ops and Home Sales
Weichert Realtors, H.P Greenfield
1712 Utica Avenue,
Brooklyn, New York
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First: yes, the seller can file for bankruptcy. It won't postpone foreclosure, but it will delay it. What the seller may be hoping for is to be able to stay at the house a little longer, and not pay for the mortgage. This has been known to happen. Won't be the first nor the last time.
Second: neither your realtor, nor the seller's realtor could have predicted that this will happen. Both were working towards completing the sale, and that's what they were trying to do. They don't get paid unless they close escrow. So why would either one wish for a different outcome?
If people knew how hard we work at getting short sales approved, they would be just as sympathetic towards the agents as they are to the buyers/sellers who lose out on a short sale.
Third: when you heard about the approval, did you open escrow? And did you have contingency periods? If you have not cleared your contingencies, then you, as well as the seller, may cancel the escrow and get your deposit back.
Fourth: Is it really worth it to file a lawsuit to force the seller to close the short sale? Doing so, you may spend money you may not recover, and still not get the outcome you wish for.
Fifth: This is one of the uncertainties about short sales. And this is why buyers are encouraged to keep looking at other homes while they're waiting for a short sale to be approved. Keep in mind: There are absolutely NO GUARANTEES that a short sale will be approved.
Sorry that your heart is broken over this. My advice to you is to keep looking. And now that you have a first hand experience about dealing with short sale, you are all the wiser and better for it.
ALSO: it probably is for the best. I always tell my clients that if we don't get the house they wanted, it's because a better house is coming along later. And it turns out to be true!
Hope the next time turns out better for you.....Take care.
This is a really aweful situation, I am so sorry to hear that this has happened to you. You may have recourse depending on where you were in the transaction. A seller does have the right to discontinue a short sale if they do not approve of the terms the bank came back with. However, if the seller signed off on the terms and you were "in escrow" it is the same/similar to being in a traditional sale. I would talk to an attorney to be certain. Best of luck.
Erica Jones Starkey
JSCA Real Estate Group
Providing Superior Solutions for Your Individual Real Estate Needs