Real Estate Investor · Los Alamos, NM · Member since 2014 · 151 posts · 52 votes
I am bidding on a "bank approved short sale" through auction.com. I've been offering $400K for a house that is at least worth $550K retai... if it weren't occupied by a cantankerous personality, threatened with foreclosure and burdened with a $70K property tax lien.
I've been putting in my offers through auction.com and a local realtor. auction.com send them through to the bank, which has accepted my offer a couple times. however, the sale has to be approved by the seller. since he has to pay off the $70K property tax lien, he doesn't approve the sale.
My realtor says that the property owner feels it would be better if the bank forecloses because that would wipe out the property lien.
I see that the owner has the house for sale by owner at what i think is a high price ($600K).
I am curious how the bigger pockets community sees this situation resolving itself and is there anything I can do.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
12y
Just a couple of clarifications:
It's the bank that approves the short sale, not the owner. Don't believe the "bank approved short sale" advertisement, especially from gangsters.com. If the bank has actually approved this price, it apparently doesn't include them paying the $70k tax bill, which hardly qualifies for "bank approved" at that price. This would have to come from either the buyer and/or seller, and the seller likely doesn't have the funds. And, a foreclosure will Not wipe out a property tax lien. You can keep submitting the same offer, but if you're paying cash you may be better just waiting for the foreclosure/trustee auction.
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
12y
Just a couple of clarifications:
It's the bank that approves the short sale, not the owner. Don't believe the "bank approved short sale" advertisement, especially from gangsters.com. If the bank has actually approved this price, it apparently doesn't include them paying the $70k tax bill, which hardly qualifies for "bank approved" at that price. This would have to come from either the buyer and/or seller, and the seller likely doesn't have the funds. And, a foreclosure will Not wipe out a property tax lien. You can keep submitting the same offer, but if you're paying cash you may be better just waiting for the foreclosure/trustee auction.
Real Estate Broker · Orange, CT · Member since 2013 · 951 posts · 218 votes
12y
In almost every case the bank will pay the property taxes because it will come before the 1st mortgage and stick around even after foreclosure.
The listing agent needs to include the $70k as a HUD expense for the short sale, or call the Customer Service Department and request they pay off the taxes.
The listing agent is probably misguiding their client, because the property tax is part of the short sale so the seller should not be accepting reponsibility for the tax lien just by accepting your offer.