Home Buying in 10461>Question Details

Fulla, Other/Just Looking in Outside U.S.

Hello, I am in contract on a short sale home, purchase agreements have been signed. I just found out the seller filed bankruptcy

Asked by Fulla, Outside U.S. Wed Aug 1, 2012

i was told this short sale would be a month long because it was a "bank approved short sale" and my offer was significantly higher than the list price. I have an insurance bind and locked in my rate. we were supposed to close mid August. how much longer will the discharge from bankruptcy prolong closing in you experience?

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Answers

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If the home was included in the bankruptcy the short sale is effectively shut down. You cannot buy that house while it is tied up in the bankruptcy courts.

However, it is possible and maybe beneficial to the seller to have the house excluded from the bankruptcy. If they included it inadvertently it can also be removed from the filing. I just had this happen to me on a transaction and it took about thirty days to release it from the bankruptcy filing. In that time we continued to pursue the short sale approval and received the approval subject to the release. So everything worked out.

It did cost the home owner some extra money to have his attorney do the filing. Best of luck!
1 vote Thank Flag Link Wed Aug 22, 2012
Your agent and or attorney can best advise, therefore consider a consultation; don't just rely on online information...
1 vote Thank Flag Link Thu Aug 2, 2012
You don’t have to worry because I have client that is going through the same issue. Have the bank approved the short sale yet? As longer the bank approve it, you shouldn’t have a problem.
0 votes Thank Flag Link Fri Sep 21, 2012
I would definitely seek some legal advice on this. You have to know if the home was included or excluded in the bankruptcy filing. If it is not in the filing you should have no issues moving forward.
0 votes Thank Flag Link Wed Aug 22, 2012
You need to have your agent talk to the seller's agent and find the answers to these questions for you. It may be that the bankruptcy trustee will approve the short sale and things could then go along as planned. It could be there will be a delay. Are you using an attorney to close the transaction? That would be the best place to find more specific answers to your questions and the next best place is your agent.
0 votes Thank Flag Link Thu Aug 2, 2012
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