Seller reneging! HELP! - Posted by Lydia
Posted by Lydia on August 21, 2005 at 22:09:04:
I opened escrow last month with a homeowner who though she had given up ownership of the house in the Chapter 7. She realized when she got notices from the city about keeping her grass cut, that she was still owner of record.
She moved out 8 months ago and offered to deed the house back to the bank after she found out she was still on title, but they told her they’d rather do a short sale. Well, I come along and offer to do the short sale. She tells me there is no mortgage recorded. I find that to be true. I send in the short sale package anyway. It gets turned down, I send in more information and the bank accepts my original offer.
Problem is the title company didn’t record the new deed of trust when the property was refinanced. So, the bank can’t as quickly and easily foreclose, but they have now started the process. I knew someone at the owner’s church offered her $50,000 to HER, cutting the bank out of the deal. She quit answering my phone calls, and this past week I found out that someone else was getting the electricity turned on. Thursday a Lis Pendens was filed and the foreclosure attorney called the owner at work and told her that the short sale was accepted, and the Lis Pendens was filed–they finally got the original Deed of Trust recorded. Of course, all foreclosure proceedings will be on hold pending closing of the short sale.
My partner went by the property today and there was a guy there changing the locks and having a property inspection done saying he was the new owner. I told him I had a contract pending on this house and he had no right to buy it, and the seller had no right to sell it. I gave him a copy of the Lis Pendens and the Deed of Trust, a copy of another lien on the house, and the letter from the bank accepting my offer.
The seller told me we didn’t have a binding contract because no money had changed hands. I put the earnest money in escrow last month, like I told her I was doing. She didn’t want to take the money when I first did the contract with her, so I told her it would be escrowed till closing. I’m telling you, this seems like a totally different person I’m dealing with now than the personable woman I met with last month to help her avoid foreclosure.
Then she told me that the bank didn’t accept my short sale offer, so our contract was void. I told her yes, they DID accept the short sale offer on my original contract. She knew that because the foreclosure attorney for the bank told her that on Thursday. I told the seller what she was doing was unethical and illegal. She said she had an appointment to get to and if she found time tomorrow she might talk to me about it.
I’m expecting that she will stall things until my contract expires, but it still won’t help her–she isn’t entitled to any money!!
My question is, where does this leave me? Can the bank pressure her into closing with me?
Lydia