Short Sale Negotiated ? Buyer and Seller BEWARE
Short Sale Negotiation Warnings for BUYER and SELLER
We are starting to see an unusual chain of events with short sales -if a short sale is advertised as being already negotiated with the bank please take the following precautions.
- Ask your buyers agent to call the agent and ask if there is any kind of "option to purchase Contract" in place on the home involving ANY 3rd party. - if the answer is yes please be very careful if you want to proceed with viewing and purchasing this home - Please contact an attorney if you have ANY questions that are not being answered to your satisfaction. Many buyers agents are not aware of the shenanigans that are sometimes going on behind the scenes of the properties.
- If their is a 3rd party involved ask whether the 3rd party is on the title or just assumes "equitable interest" - Again if the answer is yes its attorney time if you wish to proceed.
- Ask if there would have to be a dual closing - i.e the agent closes on the home then turns around and closes with the buyer. Again attorney time and not the attorney recommended by the listing agent or 3rd party.
As with any market that is boom or bust there are always people willing and able to do things that are on the edge of being legal or worse yet are just ethically wrong. In the cases of many of these pre-negotiated short sales the goal of the agent or 3rd party is to make a PILE of money on the transaction....only problem is that that PILE of money could be going to the bank to offset the loan deficiency of the seller as well as lessen the sellers tax burden.
Many of the people involve will declare "its perfectly legal" and "its totally ethical" and the "seller was fully disclosed of his liabilities"
If you are a seller and someone approaches you with one of these "Short Sale Programs" please take to a trusted Real Estate Attorney and /or tax professional before signing anything. Sellers should also be aware that it is not allowed by our MLS to list properties on the MLS by anyone other than the TITLED and DEEDED owner. EQUITABLE interest partners are not allowed to list on our MLS.
I can provide excellent attorny references if required.