The servicer makes more money by not selling it to you for as long as possible.
Seems to us that the bank never had intention to sell it via short sale. The bank most probably will foreclose buy it back and relist it at usually a higher price, however you may if the owner can't recind it put in your orginal offer you never know.
We strongly suggest you move on and look for an NON short sale property as short sales are really long and rarely close.
All the very Best
Dave & Lisa
When you prepared your offer, your agent should have given (and received your signature) on the CAR Short Sale Addendum Form SSA. Paragraph 4 is titled NO ASSURANCE OF LENDER APPROVAL and stated "...short sale lenders are not obligated to give consent to a short sale..." Your agent should have also told you that the banks pretty much run their own game and are accountable to no one, so pursuing any recourse may only add to your frustration.
CENTURY 21 Superstars
However, it depends on how much longer you're willing to wait. If the bank foreclosed, then it'll eventually put the house on the market. Might be a few weeks; might be a few months. At that point, it'll be available for purchase. Now you'd be buying directly from the bank. And foreclosure purchases--while not perfect--tend to be a lot smoother than short sales.
One interesting tip: Often the house is put on the market as a foreclosure at a lower price than the bank would have received (and even approved) as a short sale. I've seen that happen a lot, though there's no guarantee of that. But I've seen properties listed and sold as foreclosures for 10%-20% less than submitted short sale contracts. In fact, in one case (I wasn't the Realtor, but I talked to her), she'd been representing some folks like you who were only days away from closing on a short sale when the bank foreclosed. She happened to know the private investor who bought the house from the bank. She negotiated a deal where the investor sold the property to the interested family--the investor made something like $15,000, but the family ended up paying about $7,000 less than the bank had approved the short sale for.
Again, there's no guarantee of that. But if you really, really want the house--and you're not under huge pressure to move--you could wait for it to come back on the market.
Hope that helps.
Sorry to hear this news. At the end of the day, its time to move on and find another property.
There are a few things about short sales that everyone loses track of during the process;
1) The "Bank" and the "Investor" is NOT the "Seller" or the "Owner".
2) The Bank / Investor is onlky approving the amount of LOSS they are willing to accept.
3) Although the seller may have thought they had an approval - they likely didn't or it would have been in Letter Form from the Servicer (Bank).
4) Whether anyone wants to admit it or not, the Foreclosure Sale would have been well-advertised, and unless the seller had something from the Trustee stating the sale was postponed or the Trustee Sale date was changed on the Trustee's website, it was not.
In 2011, postponements of Trustee Sales and/or extensions of approved short sale closing dates will be VERY RARE.
Hopefully, you didn't deposit your earnest money or you've already received a Release from the FORMER OWNER so that you can get you $$ back from Escrow.
Best of luck,
Broker / Owner & Certified HAFA Specialist
Thom Colby Properties
Newport Beach, CA
Moving Lives Forward (TM)
We NEVER DOUBLE-END Transactions in our Brokerage. IN MY OPINION, there is NO benefit to the Seller or Buyer and only benefits the Agent. Also, NEVER use your RE Agent / Broker as your Lender or vice versa. Also, be careful when using Real Estate Broker-owned Escrow and Title Companies - they can be loads of trouble.
888-391-5245 Direct Cell
Most times the department you are dealing with at the bank (short sale) is different from the Foreclosure department. Many times they are not even in the same state! It is not unusual for this to happen. You are taking your chances at not getting the home on a short sale. The sale is contingent! You trade the possibility of getting a reduced price for your time waiting. Sometimes it works out and sometimes not. Don't get discouraged though. There are a lot of really great homes out there. And honestly I do not think the short sales are much better deals than the standard sales and repos! Because the banks are getting generally 3 BPO's and selling at or close ot market anyway. Why put yourself through the stress? Find a good realtor to watch for a good deal to come up for you, one that you know you can close on.
Best of luck to you,
Prudential CA Realty
Most often the short sale IS the better deal for the bank, but occasionally there may be newer comps that look more promising to the bank to just go with the REO sale. Your agent, the listing agent & if any, the attorney needs to do their research NOW.
And, you need to MOVE on this NOW.
You, as the buyer do not have any recourse since your whole deal is 'subject to lender/ investor approval'. Read the details of the short sale approval letter you received. When the servicer sends out an approval letter, this means the investor approved the deal too. Times when they can pull back final funds is normally only when an Arm's Length affidavit has not fully been signed or notarized & turned in.
Realtor Since 1996
Short Sale Expert
Don't give up! There will be more chances to buy this same property, and if you're really lucky you'll get a slightly better price. If you do not have cash to buy the property on the courthouse steps in the Trustee's Sale, it is very likely to go up for sale quickly after the Trustee's Sale either as an REO (if the bank does not sell it for cash at the Trustee's Sale) or listed by the investor who bought it from the bank at that sale.
I can help you track the Trustee's Sale if you're interested.
I am so sorry you have experienced this. I do not know if it can be rescinded. I have heard of stories, but not a party to one. As for recourse, I'm not an attorney so I can not give legal advice. I would recommend you read your documents, I highly suspect you have signed acknowledging - somewhere - that this was a possibility.
I'm so sorry....the fact is you've probably wasted those 4 months. That's such a shame. Short sales are tricky and there is no guarantee. All we can do as agents is our best.
If you love the home, it might come back as a bank-owned, so make sure your agent is watching that for you? You might even find the price is lower once it's back on the market. I had one client who this happened to and 4 months later we were able to buy the same property, $40,000-ish less. Strange market.
the bank it is usually spelled out On
what they want done in a specific time. There are different factors involved in each situation as to what happen on the banks side or possibley the agent. Good luck.
A lot would depend on whether the seller is able to rescind the sale and whether
the offered price is out of whack.
Maybe your offer was too low comapred to what the market is doing right now.