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Bank approved my short sale but the seller will not close?

I put in an offer for a short sale house and after six months it was approved by the bank and I got a welcome closing letter from the bank. It was decided we would close dec 10th but one week before closing the seller decided they needed more time. My lawyer sent a time is of the essence letter saying they must close by dec 15th. Tomorrow will be the 15th and it does not appear we will we closing because the seller said she won't close unless I give her 8000 to move out of the house. We have a signed contract and everything, my lawyer said I can sue but they have nothing so it would be of no merit. Am I supposed to forget about this house now? My agent doesn't return my calls, haven't heard from her in over 4 days. I don't know what I should do, I have 5000 in escrow when I offered on the house. My lawyer has no advice, I feel like I am wasting my time. Please any advice would be greatly appreciated.
  • December 14 2013 - Englewood
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Answers (9)

do not involve yourself in any payments outside of closing.  you  most likely signed affidavits...  read them carefully....  before you do anything.   don't assume anything.   advise with your attorney on this all the way..

This is mortgage fraud.  If something was to trace back to you later. you will regret it...  Don;t think the banks are not aware of this stuff going on.   they are out there looking.   It has been done to them time after time and still happening.   You don't want to be the one to get caught next.

If this is a single mortgage lien it is highly unlikely they are asking for the money to table from seller.  In fact I haven't seen this yet since reform act.  2nd yes but not the first!

JAN10 you will see more of this laws are changing... See My Blog
 
Those with 50,000 or more in assets ill not longer be able to short sale unless approved by Fannie/ Freddie, interested to see how far they push this...  taking retirement ira stocks .  etc.  I read "in Bank".... 

Zillow does not allow me to self promote or provide my websites or blogs.  So I may not be able to post it here.   Funny they can promote my homes for sale to promote themselves but when it comes to me putting a little helpful info and my name on it...  Zillow don;t allow!  Sorry I can't provide more...

  • December 16 2013
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Profile picture for gator70
These are not certain. The bank could have required the seller bring cash to close. They often do. If the seller has no money or hides money they can't close. If the bank assumes the seller has been piling up cash, via the unpaid mortgage payments in some place, they want this money before they agree to lessen the payoff amount via write down. 
  • December 16 2013
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Profile picture for JoshBarnettREIB
Contact the agents Broker and double check everything with your Attorney.  This is a hard situation.  
  • December 16 2013
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You should walk away ... The seller will be sorry in the long run.  This house is not for you.  If you gave the seller any money it would have to be outside of the closing and the lender would would have no knowledge of it .... however, in all of the short sale negotiations I have been privy to this is a big no no.
  • December 16 2013
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My feeling is why isn't seller getting money from her negotiations.  The bank should have provided this money....already!   Look at the HUD for closing  see if seller is getting any incentives...  I have been successful getting money for my seller clients up to $20,000. 

Maybe seller is getting greedy!   she must be getting advice from someone.  Most of this type of behavior has been in Florida.. other places, I'm sure...  But I know of one where they asked the buyer to pay the attorney...  not the seller...   So the buyer was being represented by same attorney... the sellers and now the buyer also.  Yikes!  I know its possible... But really!    Buyer decided to go ahead and pay the 2800 because of the deal they were getting...

I would hang in there...  Talk with other side who is negotiating the short sale...   the bank may just give in and provide some incentive for seller.

Also look at your addendum's.  Most provide so the seller can back out.... but once they accept the terms of the bank, which they have to sign...  they are bound by the contract terms...  But if someone doesn;t want to play along it is their choice.  The addendum will also allow for deposit moneys will be returned to the buyer if seller backs out. 

I would still hang in there...  if you like the place...  you have nothing to lose... I think you can have the upper hand here!

*******************************
One thing on your side...  READ THE APPROVAL LETTER.  It will say that the seller will not get

Information provided is not intended to be legal advice, you should always seek an attorney for all your
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  • December 15 2013
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Get your earnest back and move on.  Sometimes short sales can be great deals and sometimes they can kill your time.  Unfortunately, you have experienced the latter.  
  • December 15 2013
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Unfortunately, with a short sale you are not buying from the bank, you are buying from the seller.  If the seller won't close, you can sue her, but as your lawyer pointed out she has no money so you will probably never collect anything even if you win.

You cannot give the seller the $8000 without approval by her lender (which they will never approve) or you will be assisting her with committing loan fraud.

I think you are stuck unless you can get the seller to comply.  I think I would hang in there a bit longer maybe when she realizes she is not going to get any money she will acquiesce.
  • December 15 2013
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Your agent and your lawyer should be giving you advice here although it sounds like your lawyer is not much help.

If your agent does not return your calls after 4 days, you should have contacted their manager/broker 2 days ago to ask for some intervention. A manager is responsible for their agent's actions. Don't wait any longer.

Taking a pragmatic view, it may take the $8,000 (or a negotiated lesser amount) to the seller to make it happen if you really want this house.
  • December 14 2013
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Profile picture for Outer Banks N C
You have a lawyer so we would suggest you do what they advise. Gotta love short sales.


tim
  • December 14 2013
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