Home Buying in 93550>Question Details

Homebuyer, Home Buyer in Sacramento, CA

My offer was accepted by the bank on a short sale. The seller is now saying that they will strip the house unless I pay them $25,000..any advice?

Asked by Homebuyer, Sacramento, CA Mon Sep 20, 2010

The seller says that the garage door, sinks, cabinets, front door..etc. are his personal property and that he has a right to sell them unless we give him the $25,000 in cash after escrow closes. The seller walked us through his house listing everything that he will be tearing out and selling if we don't pay him. This seems completely unethical. How does one deal with this situation? The house is in CA.

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15
I would contact the police and broker of the listing agent as well as a attorney. I would think that the bank accepting the short sale would have some verbiage in the short sale agreement stating that the seller is not receiving any proceeds. This is fraud!

Best of luck,
Nancy
1 vote Thank Flag Link Mon Sep 20, 2010
Call the police!

You have a contract to deliver the house in the same condition.


Richard
1 vote Thank Flag Link Mon Sep 20, 2010
Ridiculous - I'd cut and run. You cannot control what this person will do.
0 votes Thank Flag Link Tue May 28, 2013
What you are discribing has a term, it is called FRAUD. He has no right to anything attached to the house or the land. I know this answer is late, but you had better make sure your agent knows about this and he speaks to the listing agent. Make sure that they know that anything missing will be sued for, even if you have to go after the listing agent and his company.

Don Gockel, Keller Williams A.V.
0 votes Thank Flag Link Thu Sep 30, 2010
http://www.dre.ca.gov
http://www.ag.ca.gov

Contact the above.
Best wishes, Rudi
Web Reference: http://www.umboc.com
0 votes Thank Flag Link Thu Sep 23, 2010
You didn't say whether you have signed off on contingencies yet, in which case you have options to get out of the transaction yet. You also don't say what your agent had to say about this?? And third, you signed a contract with this owner and you might point out that on the contract they did not "exclude" these items from the sale. If you want to continue trying to purchase this home, I would ask your agent whether the broker they work for has an attorney for their office for such advice. It's certainly a sad situation to see desperate people say and do unethical things.
0 votes Thank Flag Link Tue Sep 21, 2010
Hi HB. Thumbs Up to Richard and Nancy and listen to both of them. Get your local police involved, this sounds like grand larceny to me. It's outright theft. Don't be blackmailed into paying money to these thieves, because that's exactly what they are.

This happened in a home that I sold to an investor. Instead of blowing the sale, the bank paid for all new appliances. Your situation is more serious.

They deserve jail.

GOOD LUCK.

Scott Miller, Realty Associates, Boca Raton, FL
0 votes Thank Flag Link Tue Sep 21, 2010
Homebuyer first I would thank the seller for giving me that information. Second I would let my Realtor® know what the seller had told me. Second I would contact a real estate attorney to see how to proceed.

This seller seems like a real pain. The home is his property but you are dealing with extortion. You are entitled to a final walk through before closing and if one thing is removed I would not close. I may have someone at the property durring closing to make sure that nothing leaves. After closing the property is yours and the current owner has no right to it.
Ps try to get in writing from the seller how much they want and what they are going to take if you do not give them the money. If they are dumb enough to try to shake you down they may be dumb enough to put it to paper.
0 votes Thank Flag Link Tue Sep 21, 2010
Most short sales have specific language from the seller's lender(s) stating that, among other things, they don't get to walk away with a thin dime. There may even be something that you will have to sign acknowledging this fact.

If he's agreed to these standard short sales terms in order to benefit from shedding debt via short sale, then you are right - it is unethical and as John says, potentially fraudulent. Including, if you participate, potentially fraudulent by YOU.

From a doh! standpoint, I also don't get how he can tell you that you have to pay him $25,000 post escrow closing. At that point, wouldn't it be YOUR house, such that if he tried to gut it, you could have him arrested? Or does he get to retain possession after close of escrow? (which shouldn't happen in a short sale in any event, there is no incentive for him to ever get out!)

I'd suggest calling an attorney ASAP.
Web Reference: http://www.kimnoonan.com
0 votes Thank Flag Link Mon Sep 20, 2010
What the seller is attempting to do is beyond unethical. It is fraud. The seller is attempting to sell a house that is being portrayed as being in a certain condition but the seller intends to deliver a house that is in substantially different condition unless the seller is paid a large sum of money. That sounds like extortion against the buyer and fraud against the lender to me. Just my non-expert opinion, of course, since I am not an attorney.

You may need to get an attorney involved but at the very least, you must make sure that your agent and the seller’s agent are both fully aware of what is going on. Neither of them can participate in the seller’s plan of action nor can they turn their heads and ignore the threats.

If the lender is aware of the sellers’ plans, the lender will not approve the transaction or they will cancel any approval that has been issued.

By the way, advice to call the police is poor advice. If the seller still owns the house, he can remove anything he wants. It is his. Of course, causing waste and destruction to the property is a violation of his loan agreement with the bank so, again, my advice is to let the lender know of this seller’s plans.

In the end…this is not the house not the seller with which you want to be involved.
0 votes Thank Flag Link Mon Sep 20, 2010
The bank doesn't own the property yet & even though it's upside down with equity, I don't believe it's illegal to damage your own property (I don't think the police will be able to help). If it were bank owned, that would be a different story, HOWEVER, please read below:

The purchase agreement automatically lists a bunch of items that need to STAY, particularly ATTACHED FIXTURES

Attached fixtures ARE: Sinks, garage doors, cabinets, front door, even the dishwasher & stove are considered attached fixtures.

VERY IMPORTANT: 1st ask for a COPY of the Short Sale approval letter. (this will have the phone number or contact info. on it for the Closing Dept. at the bank) Once you have this letter (which also has the sellers loan # on it, call the closing department & say this:

" The seller is demanding $25k from me or he's going to rip the place apart & remove Attached fixtures like (name the items) according to my agent he'd be doing something called "Bad Faith Waste". Can you please produce a letter quickly to let him know that if he does this you will sue him for damages to the property" (((then go on to say that you will back out of the deal & don't know of another buyer that will pay X price for the property after the seller rips the place apart, cuz gosh knows what else he'll damage"

As you're speaking to the bank & the seller has or still might take these items, demand that the bank pay for ALL of your closing costs OR agree to reduce the price by whatever the amount is for replacing what this owner plans to take.

Sellers don't understand that the bank CAN place a lien on them personally or issue a type of judgment for destroying I.E. ripping out everything that THEY think is personal property for the amount of the replacement cost.

These are my opinions, but if you speak with an attorney they may also have some other creative ideas on how to go about this.

EmilyKnell1@yahoo.com
562-430-3053 cell
0 votes Thank Flag Link Mon Sep 20, 2010
Does his agent know this? Sellers are not allowed to profit from a short sale. Period. The bank needs to be aware of this.
0 votes Thank Flag Link Mon Sep 20, 2010
If it was me, I'd walk away. What he is asking you to do is completely unethical and may be illegal. In a short sale, the seller is not allowed to profit without the bank's consent-- if there's money on the table, the bank has a claim on it. If you want to be a jerk about it, tell him you'll call the bank and ask if it's okay. He knows it's not, so that should make him sweat a little... I'm a little outraged right now, and I'm worried that if you walk away he'll keep extorting buyers until he find one that doesn't know any better. Ech.
0 votes Thank Flag Link Mon Sep 20, 2010
Hello Homebuyer,

Yes, my colleague Richard is correct - if you are using the CAR purchase agreement, the seller is required to deliver the property at closing in the exact same condition as of the date of acceptance. Unless the $25,000 was agreed to in writing, the seller cannot force that condition.

Good luck with your situation!

John Barry
0 votes Thank Flag Link Mon Sep 20, 2010
Any monies exchanged between buyer and seller need to be communicated to the Sellers Lender. If the Seller does not want to inform his lender immediately get your agents broker involved. Also, their in-house counsel. If you don't want to bother with this you can walk away too. Sorry for your troubles! Kristine :)
0 votes Thank Flag Link Mon Sep 20, 2010
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