Long story short: Preforclosed home that was scheduled for auction just before the moratorium. I have owner on board to sell. I contacted lender and they are saying that at this time the court assigned commissioner is the only one who can sell the home. The Home owner has no legal right to sell and it must go through the commissioner. I have contacted the foreclosing attorney to see if it is possible to dismiss commissioner and allow a standard sale outside of the courts.
Any suggestions or pointers here?
@Sean Dougherty What state is this? I haven't heard of any situations like this in which an owner cannot sell their own property.
In general, if there's equity, the sales transaction goes through like normal. If the property is underwater, you need the lender's approval for a short payoff.
If the owner is in BK, however, he or she would need to get permission from the BK court to sell the property.
I have several loans that had pending foreclosure sale dates pre-COVID that were delayed because of moratoria on foreclosures. As far as I know, those homeowners could have sold their properties during that time if they wanted to.
Yes that is all how I understood it as well. Home is not in Bankruptcy. I have bought other homes in this way and it has never been an issue that commissioner is assigned. This is in Hawaii with a local Bank as lien holder. Both Bank of Hawaii and the commissioner have told me that homeowner has no right to sell the home and everything must at this point go through and be confirmed by commissioner and court system.
The lender in particular was very rude and standoffish and wouldn't speak with me much even though I had a 3rd party authorization from seller. They told me I would have to do all negotiations through the commissioner as he was now legal rep for the property. From my experience with other banks they are usually quite accommodating considering I am offering to fully payoff a delinquent mortgage.
I have contacted foreclosing attorney and told them the situation and they are contacting the lender on my behalf to see if they can dismiss commissioner and allow the sale.
So many questions! Are you wanting to buy the home? Just go to the auction and bid on it. Or submit your offer directly to the commissioner (private sale).
Once the commissioner is appointed, the seller does lose his legal right to sell the home.
Have you pulled title report? It may be too underwater for seller to sell to you at a price that makes sense.
I serve as an expert witness for Hawaii foreclosures, so I know the process pretty well. PM me