Short Sale Nightmare

Short Sale Nightmare

Wholesaler · Dallas, TX · Member since 2009 · 308 posts · 92 votes

My friends daughter came to me with the following story asking for help.

Seller is approved for Citi short sale. Listing agent finds buyer who submits offer.

Buyer wants to lease prior to completion of approval by bank. Listing agent recommends this and tells seller to move out. Listing agent does lease agreement, takes deposits, rent and option fee, even though lease agreement has no provision for option.

Realtor holds checks for 15 days. During which time, buyer/renter begins unauthorized rehab. Puts utilities in their name, etc.. But, never occupies the property.

Buyer decides to exit the deal ten days later. But, buyer has caused $1,500.00 of unfinished rehab, cut of water so all landscape is dead, pool has now turned green.

Total damages over $10K.

Realtor who had the checks totalling over $2,500.00 never put them in escrow. Buyer stopped payment on all of them. No money for seller!

Seller receives letter from Citi stating that if they have vacated, they may not qualify for short sale.

What are your comments?

How can I help this person?

What recourse does this seller have?

Never heard of anything like this!

0Reply
43 views

Most Popular Reply

Joel OwensBusiness Member
Moderator
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
15y

I am not in this transaction but sounds like gross negligence on the part of the agent giving advice which had adverse consequences.

Time to call the main brokerage who has the listing and tell the qualifying broker the seller will sue if the broker doesn't immediately pay damages.

Short sale or no short sale the damage is almost the same anyways.Could just do a DIL if no other liens are present to the bank.

No legal advice.

See this reply in the discussion

28 Replies

Jump to latestLatest
  • Wholesaler · Dallas, TX · Member since 2009 · 308 posts · 92 votes
    15y

    Scott:

    Buyers breach and damages is separate and apart from agents damages/actions.

    Two distinct cases. Although tied to this transaction, each has a separate liability for this.

  • Investor · Rancho Cucamonga, CA · Member since 2008 · 1k+ posts · 684 votes
    15y

    Chris - From what you originally described it sure doesn't sound like 10k in damage to me. You mentioned $1,500 rehab, plus green pool and dead landscaping?

    I would recommend you help negotiate the best settlement you can from both parties and tell them to move-on. The agent did an absolutely terrible job here.

  • Wholesaler · Dallas, TX · Member since 2009 · 308 posts · 92 votes
    15y

    The $1,500 is the cost to repair the unfinished rehab. More for the pool and landscaping, plus rent deposit and breach.

    Agent actions are more to damages, loss of SS status, escrow, etc...

Join the conversationCreate a free account to reply, vote on answers and follow this thread.