Without signed permission from the seller, there is no way you or your agent can negotiate with the sellers lenders. Even if you were able to negotiate with the lenders, I wonder if any additional money put into the purchase wouldn't be sucked up by the 1st lender until their short fall is satisfied. In other words, if they're paid 100 percent, You don't say in what state the home is located, but if the home is in a non recourse state, the 2nd lender receives zero in a foreclosure. But in a recourse state (with limitations) they may be able to initiate legal action to collect a portion of their loss. Although my guess is that, after legal costs, etc, they would be lucky to collect 10 -20 percent of the unpaid debt.
What was your concern about the due diligence? If you're purchasing the property from the present owner, they would be required to give you clean title to the property which would be free from all encumbrances. You would also purchase title insurance and the title insurer would provide due diligence as part of their fee.
Unless the home has gone through foreclosure, the bank doesn't own the home. Any attempt to purchase the home would have to go through the legal owner of the home.
Based on your previous questions, it would appear you're looking for free legal advice. Realtors aren't attorneys and attorneys won't answer you question on this forum. If you have questions regarding your foreclosure, I would urge you to contact legal representation.
There are often websites that sell purchase agreements online. But if you use an outdated document, fail to use the correct document, miss a document or make errors in the document, you open yourself up to possible legal issues after closing. If you have an agent willing to do the paperwork for a flat fee, I would go with them. Otherwise you can use an attorney (which probably would cost you more).
If the listing asked for an affidavit of occupancy that should've been included in the offer.If your offer was all cash, banks will often require proof of funds (a letter from the bank, recent bank statement) to show you have the cash on hand to complete the deal.If your offer is incomplete or is missing signatures or has signatures that do not match (John Jones v. John Q. Jones) your offer may be rejected. Fannie Mae tends to be very picky about having a completed offer.Has your agent asked why your offer was rejected? Was it the offer itself (too low) or was it missing documents.
Whether the price goes up or down is often dependent on the current market conditions when the property is listed for sale. As a rule though, foreclosed homes are often easier to negotiate and are priced lower than short sales. On the down side, there is often more competition - especially at a lower price point.
You are asking a question that can only be answered by a local attorney. Since your grandmother is still alive, you're talking about making yourself her personal representative. And that can only be done with permission of your grandmother or through the courts.
When your agent writes and presents the offer, they either present the offer to the listing agent or sends the offer online (via equator) to the bank or company that owns the property.The broker at real estate offices oversees the agents (typically called sub agents) but most agents are independent contractors and handle their transactions on their own (with supervision of the broker).
If the 2nd mortgage was with a defunct bank and no one purchased the underlying mortgage, it's possible it is in the portfolio of FDIC (the folks who bail out failed banks).