Home Buying in 64152>Question Details

John, Other/Just Looking in 64153

An offer was made on a home after having done home inspection. I won’t mention the agents name or company.

Asked by John, 64153 Fri Aug 22, 2008

After waiting for six weeks for straight answer I decided to a little digging in public court records the home owner is in full section seven bankruptcies and had been when the offer was submitted.

After speaking with a real-estate attorney she indicated the creditors nor the home owner have any legal rights to sell the property while in bankruptcy. Stated it would have to be offered for the full amount owed on the court house steps only being advertised in a paid public paper for at least four weeks. If no one offers more than the full amount it will revert to the holder of the primary note.

The property was and is listed as Active status. The selling agent indicated it was a short sale.

Given these facts should the agent be taken to small claims court for the six hundred dollars plus spent on the inspections and time wasted?

Do you feel the agent was being crooked?

I won’t tell you what the attorney said in this post.

Thank you

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Answers

6
So, it is pretty clear that you should consult with an attorney as you already have but should the agent be held liable is the question. After some objective deliberation I am going to say YES. But, the seller is the one who had no legal rights to enter the agreement and should have never sold the home to begin with. Seems like an unlikely place to get any money so you are turnign to the agent. Not that uncommon.....I am intersested to see how this turns out John.

David Van Noy Jr
816 536 7653
0 votes Thank Flag Link Wed Oct 1, 2008
It is usual and customary to make the offer prior to starting inspections.
If this order had been followed, the short sale would have been revealed and you could then have determined what course would be in your best interest.
I'm not sure I understand what you were waiting for during the 6 week time period.
I'm also confused as to whether the property is being sold for back taxes or default on the loan as there are two different scenarios for those occurrences adn your description contains elements of both.
I see no evidence of "crookedness." I tis possible that ineptitude was involved, but I couldn't make that determination without more facts.
An attorney would certainly know more about small claims court than I; I'm sorry you have elected not to share that information.
0 votes Thank Flag Link Sun Sep 28, 2008
It strikes me from your description that the agent was stupid but not necessarily malicious. I think that far too many real estate agents do not understand the difference between a foreclosure and a short sale. Still may be grounds for a lawsuit and more than likely a settlement. Have you started by requesting the 600 dollars be returned to you? good luck to you.....
0 votes Thank Flag Link Tue Aug 26, 2008
When I represent the buyer in a transaction, we do not schedule inspections until after we have a signed contract - even in a short sale.

When I represent the seller, I always run a preliminary title check before taking the listing.
If it needs to be a short sale, that is stated on the MLS; and the lenders are contacted to open up the lines of communication from the beginning. Even if the lenders are difficult to communicate with because of the tremendous work load they have.

If the property is going into foreclosure due to bancruptcy, the realtor can only pull it off MLS if the owner(s) of the property keep us fully informed. Bancruptcy is stressful, embarassing, and draining; sometimes the owners forget, or avoid, telling the realtor what's happening in a timely manner.
0 votes Thank Flag Link Tue Aug 26, 2008
Ask your attorney if any of his/her clients have ever withheld the full truth from them.

I've found out later that clients lied to me. We can only represent what we know to be true. I have to take reasonable care to know the truth. But should I have a full personal investigation of each of the clients I work with? I don't know that that is reasonable.

It's the owner of the property you should go after. But, then, they don't have any money, do they? So you want to go after the agent. If you find that the agent knew and withheld then you should certainly do so by filing a complaint with the state agency that governs that agent. That will do more to them than small claims court. So now you need to know if you have proff they knew.

I'm not trying to sound cold. But that's probably where you stand.
0 votes Thank Flag Link Sat Aug 23, 2008
Many times the home owner lies to the agent (directly or by ommission) and doesn't tell them that they haven't been paying the mortgage or the taxes, that they are going through a bankruptcy, etc. The agent has no way of knowing until a title search is done on the property and in the St Louis area that is typically done when the buyer has an accepted contract and the buyer pays for the title search. It would be wonderful if the sellers were honest and forth coming with their agents but many pretend that it's not going on, under the false illusion that they can sell the property and pay off what is owed on it as part of a short sale without it being involved in the rest of the mix. In this case, they appear to at least have told their agent that it was going to be a short sale, which indicates to the agent that they either are currently not paying the full mortgage, or they expect to have the home sell for less than their mortgage amount and they won't be able to bring the differnence to the table and as a result their lender would need to approve the sale of the home, which means that they are at least communicating to their agent about that piece of the pie, but they may not have told their agent at all about the bankruptcy. The banks typically take a LONG time to respond to a short sale. I've seen some tbanks take 6 months to respond with 8 good contracts on the table over list price, letting the home go into foreclosure, then take the home off the market, process it through "their system", and relist it with their REO agent throwing out all the current contracts and making all the potential bidders start over again. You can't realistically sue the agent for the seller not telling the agent the full story and to sue the agent you would have to prove that the agent knew that the home couldn't be sold. Quite frankly, no agent is going to waste their time and money trying to sell a home that can't be sold - it simply costs us too much, risks our reputation (and we live by referrals) and causes us too much paperwork and effort. Working with short sales and foreclosures is enough of a pain, without adding a bankruptcy to the mix.
Web Reference: http://www.yourstlhome.com
0 votes Thank Flag Link Fri Aug 22, 2008
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