Home Buying in 92129>Question Details

Wings21, Home Buyer in 92129

I entered escrow on a condo, and then the bank turned around and sold the condo to someone else!

Asked by Wings21, 92129 Thu Jun 24, 2010

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Jeffrey Douglass’ answer
Dear Wings,

All good advice from the agents below. One thought, if this was a short sale many agents will open up an escrow to get a HUD-1 Statement to present to the Bank. This is an estimate containing all the costs of sale so that the Bank can decide if they want to sell and how much money they are going to loose on the short sale. In other words you may have had an accepted offer from the Seller, but no approval from the Bank, who would most likely accept the highest offer. Just a thought, talk to your real estate agent and have them explain what's going on. If that is not the case then review all the contracts and addendums to see how they had cancellation rights.
0 votes Thank Flag Link Thu Jun 24, 2010
I agree with Oscar,

The addendums and counters from the banks Asset Manager can be lengthy, confusing and even dare I say misleading! Sometimes they will contradict each other or have contradictions within the same counter or addendum. It is easy to miss something that allows the bank to bypass you. Generally if you are missing just one initial or signature or one day late on a contingency that is enough for the bank to legally void the contract. They don’t even need a “Notice To Perform” in most cases. The time frames are also regularly shorter than what is standard on our CAR forms. Go over the entire contract including the banks addendums and counters. I am sure there will be one or the other.

Best Regards,

Eric Soderlund
1 vote Thank Flag Link Thu Jun 24, 2010
It depends if teh agreement and the addendums were signed by you and by the seller. often in REO sales teh seller will verbally accept yoru offer based on completing the bank addendums, teh bank addendums states teh property is still for sale and will be marketed until teh agreements are signed by the seller. they also could have send addendums to several buyers and than choose which ever one has teh best price and terms. The highest price isnt always teh best offer.

An offer free of contingincies, no home inpsection and closing in 30 days is better than one with continigincies. You need to ask your agent what happend. your agent shold have guiided you and informed you through each step. if you didnt have your own agent, you should have had an attorney review the paperwork for you. it is never accepted until it is signed in writing.

I have some tips on buying a reo property or short sale

http://www.trulia.com/blog/scott_godzyk/2008/08/so_you_want_…

This may help for the next one
0 votes Thank Flag Link Thu Jun 24, 2010
I understand your frustration, especially if you were in escrow, and already paid for an inspection and appraisal. Banks often have their own document(s) stating that they can sell the property to a higher bidder, even when in escrow; I've even seen this on bank-owned properties, although it never happened to any of my buyers.

Next time you sign any bank contracts on an offer you submit, read every line carefully, and make notes of the terms and dates. If you read something that doesn't sit right with you or make sense, ask your agent to clarify it. Sometimes it's not even apparent to the listing agent, and they'll say, "Oh, that never happens," but now you know it can. So, just be aware in the future.

As Oscar said, read each page of your contract very carefully, for any verbiage allowing this. If you don't see anything stating the bank can do this, then speak with an attorney, especially if your contingencies were "effectively" removed, which is common wording with some banks. And, as Jason said, some short sales in escrow actually end up foreclosing, and being listed again as bank owned - for a lower price! It happened to one of my buyers too, but he know it was a possibility.

Sometimes short sales don't proceed as logically as you think they should.

All the best to you on this, and in your next home search!

Cory
0 votes Thank Flag Link Thu Jun 24, 2010
Another reason this migt have happened is you were in escrow on a short sale and the bank foreclosed on the property and re-listed it and sold it to someone else. I have seen this happen before and have had it happen to one of my buyers as well. We were able to get the property anyways from the new seller. Hard to tell without more info but ask your agent or their broker who I am sure could explain what happened to you. Otherwise you might have a pretty good case. Good luck!

Jason Conner
Pacif REO Properties
619-990-2209
0 votes Thank Flag Link Thu Jun 24, 2010
Wings,

By viewing your comment as presented, it would appear that this is a commonly accepted part of the "foreclosure" purchasing process.

Working with a real estate professional that is somewhat informed about the foreclosure process may be beneficial.
0 votes Thank Flag Link Thu Jun 24, 2010
Hi there,

Before spending time and money with a real estate attorney, you and your agent should go over the executed contract. You should corroborate the terms of the contract with escrow instructions (they should be the same). If you (buyer) did not execute a term and/or deadline specified in the contract that allows the seller to cancel then there is justifiable reason for cancelation. If the seller, despite of been an REO listing cancels without any reason, then your can seek legal assistance.

On the other hand, if you choose to pursue the seller for breach of contract be realistic of the cost involve versus the gain.

If you have additional questions feel free to contact me.

Thank you,

Oscar Garcia
Oscar@SellingOurCity.com
Executive Realty Group
(800) 291-0053 Direct
(800) 291-0089 Fax
0 votes Thank Flag Link Thu Jun 24, 2010
As Mark and Kari mentioned you need to talk to you real estate agent first and find out the details. There were may be clauses in the bank addendum that gave the bank ability to cancel.
Best of luck.
Raana Jamshide
Broker Associat, REALTOR,CRS
(858)-229-2200
0 votes Thank Flag Link Thu Jun 24, 2010
I am confused. How can you be in contract and the bank sell it to somebody else? I would do as Mark and Kari recommended and speak with a real estate attorney.
0 votes Thank Flag Link Thu Jun 24, 2010
Hi,

The best advice we can give you is to talk to your agent & their broker, and possibly a Real Estate attorney.

REO sales can be complex transactions and every bank contract states the bank can cancel at any time.

We hope this helps,

Mark and Kari Shea
Real Estate Experts Serving San Diego County
Specialists in Investment Properties, Foreclosures, Short Sales,
Development Opportunities & Traditional Real Estate
http://www.shea-realestate.com
0 votes Thank Flag Link Thu Jun 24, 2010
Is your question: can they do that?

This sounds like a short sale or a bank-owned property. If it is, they will sale the house to the buyer with the best offer, just like any other seller.
0 votes Thank Flag Link Thu Jun 24, 2010
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