Ultimately bank decides how to move forward when in default.
When you are dealing with a short sale you negotiate ONLY with the Lender. Their approval depends on offer you make and they do not take "low ball" offers. They want to collect at or "near" what is owed on the property to avoid more of a loss in court and will accept "highest and best" only. Meaning that the offer must be close to what they are asking and collateral must be credit ready or cash. Also, you need an attorney that specializes on REO's, as they know exactly how to handle these types of purchases and what to do.
To learn more about making an offer on bank owned reo's, read more on my website "Placing a Bid on Short Sale/REO Property"
I agree completely w/ Gary and concur w/ him that Christine is entirely and completely incorrect.
For as long as the seller is the legal title holder, only the seller, or his/her appointed Power of Attorney or Guardian can sell his/her property. In a short sale, a lender must approve the sale, since the lender will be accepting an amount less than the full amount.
A lender can sell an REO property........one which the bank owns after a foreclosure action is completed.
In a short sale, the seller is still liable for the loan and still has rights to the property.
What about the "Right of Redemption"? A property is owned by the "OWNER" until the gavel swings. How can you say that the "Seller has nothing to do with sale" (which is wrong on multiple levels)
The fact is that the Bank could agree to the sale and every one could be moving forward and the seller can, for no good reason, change his/her mind and the deal is done.
I am also NOT an attorney, and I didn't even sleep at a Holliday Inn Express last night, but I can read the law and I do use common sense and your statements are blissfully incorrect.
The Answer to the actual question posed is NO, a house cannot be sold without the sellers consent/signature. That is why he is called the â€œSELLERâ€. It can be taken in a foreclosure action which means it is surrendered to the lender, but not sold without the sellers consent. Some of the answers here astound me.
Good luck and let us know how it turns out.
Gary De Pury
Bay Vista Realty & Investments, Inc.
Director, Florida Association of REALTORSÂ®
Chairman, Communications Committee
A short sale occurs while the "original" buyer is still the owner, prior to the bank taking ownership. As such, a short sale is a transaction between a buyer and the homeowner who is in default. The lender's involvement is the same as a contingency is when purchasing. That is, a purchase may be contingent on an acceptable home inspection...upon approval of investing partners (a common contingency among real estate investors...upon obtaining financing...OR upon approval of a third part (the lender).
Only after the lender becomes the owner of the property--after the foreclosure--does the buyer purchase the house from the bank.
In all cases, the owner (whether it's the person in financial difficulty in a short sale or the lender when the property is REO) must consent to selling the property.
And in real estate transactions, for a transaction to be binding it must be in writing. (Technically, and again I'm not a lawyer, a real estate transaction can be "legal" but not binding.)
Further, in short sales, one of the documents presented to the lender is a sales contract between seller and buyer. (It is possible for the lender to agree to an amount prior to the sale, but a short SALE can't be transacted without a sales contract.)
So, to answer your specific question, a buyer cannnot buy a property in a short sale without the seller's signature.
Not legal advice; for legal advice, consult a good real estate attorney.
Hope that helps.
That said, IF the bank sues you to foreclose on the mortgage, AND the judge gives them an order of foreclosure, a buyer can purchase the property from the bank with or without your consent, AND if you owe more than the bank sells the property, yes the seller (you) could still be responsible for the balance (a/k/a the defficiency)
In Arizona, when doing a short sale, even if the homeowner has multiple offers, they must choose the best one and sign it to send in with the short sale packet. Without the homowners cooperation, I cannot see how you could make an offer to the bank because you would need their financials, a hardship letter, paycheck stubs, tax returns ect....to build the short sale packet. Plus, the homeowner has to accept the fact that they might have a deficiency judgement against them, as well as a tax concequence for the discounted amount. Lastly, they have to sign at closing which I am sure they would not if you tried to go around them!!!
Maybe you are getting an REO (Real Estate Owned) confused with a short sale? With an REO, you could just go make offers to the bank, because the bank is the actual owner of the property. I hope this answer helps!
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