All Forum Posts by: Sean Dougherty

Interesting scenario. Looking to purchase a home in probate, that is underwater and being foreclosed on, and to top it all off, no executor...I'm working with administrator.  I have worked with two court appointed special administrators to probate properties in the past who have agreed to submit my  offer to bank for consideration. On this particular deal, administrator says "no way". It is not worth his trouble.

As appointed administrator I understand that it his job to do whatever is most beneficial or the estate. Why then would he not be willing to allow short sale before it's foreclosed? It would be beneficial for the estate in that all deficiency amount from sale would be forgiven, where as if it is foreclosed bank would come after the estate for the amount short. Wouldn't it make sense in that scenario?

Also as far as I understand administrator would be compensated for his time and efforts by the estate or in some cases by the bank if short sale is approved. Is all this correct?

Anyone have any practical experience or advice on this matter? Thanks

Hello everyone and thanks in advance for any pointers or advice.

I, as a seller, have had this home in escrow for over a month. Buyers were qualified and solid offer above asking. Inspection report came after 15 days and all repair requested I agreed to. One of the requests was for a larger catchment tank. (This home is in Hawaii where water comes from rain catchment.) Because offer was well above asking and they seemed serious I agreed and spent 5k for a new tank installed. 

The day all the repairs are completed and tank installed (after $6,000.) they send termination of contract notice, 2 weeks before scheduled close. They claim I broke contract due to the land survey report not being submitted on time. Which is true, I called all surveyors the day escrow opened and due to the location of property the earliest survey could be completed was after the date on contract. My agent informed sellers and their agent of the situation and delay very early on and they said no problem. Unfortunately this conversation was over the phone and not in writing. But they are not denying that they were informed and agreed to the delay. 

Yet still they are backing out citing this breach of contract on my part. I had been in touch with them just a few days before they cancelled, asking them details of how they preferred the catchment installed. They did not mention anything about survey being late on that day, rather they gave me specific instruction where and what size catchment to install. 

Bottom line, I know they have other reasons for backing out but are using the 0-1 as an excuse to try and hang on to their deposit (which is over 3k). I told them I was contesting this and wanted the deposit, to which they responded "Seller broke contract and are demanding deposit returned."

Mediation is suggested in contract if agreement cant be made.

What play do I have here.  

Here is terminology n contract:

K-2 Survey. Within ______________ ( ) days after the Acceptance Date, Seller shall, at Seller’s sole cost and expense, have a land surveyor licensed in the State of Hawaii: (a) survey the Property even if the boundary points are visible and; (b) if improvements exist along the Property line, provide Buyer with a map (with surveyor’s stamp) and accompanying report to show the perimeters of the Property and the location of any improvements in the vicinity of the perimeter Property lines. The survey and map may not address whether improvements on the Property are in compliance with State and/or
County requirements, subdivision covenants, conditions, and restrictions, and/or condominium property regime requirements.



O-1 Termination Due to Default. This paragraph shall not apply to a particular obligation or contingency if Paragraphs O-2 or O-3 have been specifically designated as a termination provision.
In the event that Buyer is in default for failure to perform Buyer’s obligations under this Purchase Contract (Seller not being in default), Seller may terminate this Purchase Contract, and (a) bring an action for damages for breach of contract, or (b) retain the initial earnest money deposit and all additional deposits provided for in this Purchase Contract. However, if the Buyer has performed the obligation prior to Seller delivering written notice terminating this Purchase Contract, then his termination provision shall not apply to such obligation.
In the event Seller is in default for failure to perform Seller’s obligations under this Purchase Contract (Buyer not being in default), Buyer may (a) terminate this Purchase Contract and bring an action for damages for breach of contract, or (b) seek specific performance of this Purchase Contract. However, if the Seller has performed the obligation prior to Buyer delivering written notice terminating this Purchase Contract, then this termination provision shall not apply to such obligation.

Thanks for the replies. I think tho the point of my question has not been addressed. Can I (the buyer) provide funds to the personal rep (seller) without even informing the bank? Given that they are not the legal owners or party who defaulted, there should not be any restriction for them to receive funds from buyer on the side of the deal. 

Anyone?

My question is:

In a short sale the owner in default cannot be provided any funds from buyer. It is illegal. But in this situation being that the personal rep is not the owner, and did not default, could I provide funds to him in order to convonce him to go through thr trouble of a short sale?

I see. Is there any restriction from me paying the p.r. for her services outside of escrow?

I am in negotiations with a personal representative of an estate to purchase a home owned by the estate. It would be a short sale.

I know standard policy of a short sale is that seller cannot be allotted any funds by seller or agents. Is the situation any different if the seller is not the owner of the home? Considering that they were not the ones that defaulted on their mortgage, would lenders allow a payment to personal rep for their efforts in transacting the sale (considering rep would not benefit in any other way by doing a short sale)

Or would bank provide any funds to seller for their part in selling the home?

It seems the bank would encourage the rep to sell home any way they could.

Bottom line is: What would be the benefit of a personal rep to sell a house via short sale?

Any feed back is appreciated. 

In escrow on a short sale as the buyer. A $3,000 credit card lien came up in title report. 

The seller cannot afford to pay off that lien. 

As the buyer what options do I have?

Would it not be in the 1st line holder's interest to pay off that small junior lien to allow the short sale to go through?

Could the credit card lien be forgiven or negotiated? If so who and how to negotiate?

Could I, the buyer, pay that lien separately? (would 1st lien holder allow that considering they are being shorted?)

Could I purchase property with credit card lien attached and then pay it off after sale?

Any advice would help. Seems a shame for a deal this good to go to waste over a small cc lien.

I have spoken with an heir/personal representative to a property which is in probate. Home is upside down. Heir is willing to sell to me via short sale but is wondering if she will receive "selling incentive funds" from lender. Will banks provide funds to an heir to the home in a short sale? Or will the funds go to the estate? Or will the lender not provide any funds at all?

She does not live in the home. 

Probate is still open.

Thanks for any answers or pointers.

Sorry for the long story but want to make sure to paint this picture somewhat clearly.

I am the buyer in this transaction. I have contacted home owner in default and worked with them for months to purchase their home. We opened escrow back in December through our realtor. 

Owner filled out all appropriate paper work in timely fashion, including hardship letter with proof of physical disability and loss of job. They surely qualify for short sale.

Full payoff amount is around $300k (legal fees etc. included). Home is in major disrepair. I had two separate contractors bid for repairs.  Repair estimate was for $70k. I submitted offer at  $215k all cash, as is, no contingencies. I attached both repair estimates by licensed contractors as well as my proof of funds.

Initially back in January we got a counter from loan servicer for $290k. We countered asking for a price evaluation as we felt that was too high. They did not respond for over a month. Finally after hours on the phone we find out that the loan had since been transferred to a new servicer. We got in touch with that servicer and now they will only accept a full pay off. When we asked about the value dispute, they would not give any answers as to if that was addresses or not.  

My questions are. 

1) I am sure the home is not worth anything close to $300k. And therefor the value dispute. Aren't they legally liable to at least address that request and give some documentation to support their price?

2)From the perspective of the seller: How is this fair to the seller. They are more than qualified as far as hardships go. There is no way the home will sell for the banks price. They are essentially forcing distressed home owner to foreclose even with a genuine hardship. Owner had previously received letters from bank in mail giving them information of short sale options. We went through everything they asked and gave bank an all cash offer. Is there any legal action the sellers can go through to push this short sale and avoid foreclosure?

3)It seems the only logical explanation is that the bank wants this property to foreclose. How could that be beneficial for them? 

Thanks for your time.

Existing note on home is conventional. My original offer was $205k, bank countered at $260k. Were dealing with fannie mae/homepath as investor and Ceterus is servicer. Does Homepath disclose minimum net? If not, how then to to dispute value? I know amount due on last morgtage payment was $255k. Can we request them to do another appraisal?

We have just sent in counter upping price a bit, also including accurate comps along with another bid from contractor and my proof of cash funds. Any other suggestions?