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I bid on a foreclosed house through an auction, and seller accepted my “bid” (really an offer). My bid was $30k, and when it came time to sign the documents today it showed that my bid was $38k. When I questioned this they said that the seller needs to show a loss of $38K on a HUD settlement statement, and that I would recieve a credit of $8k at closing.
I’m a bit confused and I’m trying to understand exactly why the seller needs to do this?
Net is the same if what you said is accurate though you should have something signed and executed at the price. If you're not worried about and fine with it as long as you get the same net...
Net is the same if what you said is accurate though you should have something signed and executed at the price. If you're not worried about and fine with it as long as you get the same net...
Yeah I signed it all through DocuSign today, and will be paying the $2500 deposit in the morning.
I bid on a foreclosed house through an auction, and seller accepted my “bid” (really an offer).
My bid was $30k, and when it came time to sign the documents today it showed that my bid was $38k.
When I questioned this they said that the seller needs to show a loss of $38K on a HUD settlement statement,
and that I would recieve a credit of $8k at closing.
I’m a bit confused and I’m trying to understand exactly why the seller needs to do this?
What did your ATTORNEY say when you showed him their documents?
ftm... what was said about your offer/bid contract?
What did your ATTORNEY say when you showed him their documents?
ftm... what was said about your offer/bid contract?
I will be speaking with her about it in the morning when I take her the EMD check. It is what it is at this point.
Here is the exact response from the auction company...
Quote:
Your approved sales price is $30,000 for this property, the seller has to report their loss amount of $38,000 to HUD therefore please reference item 18 of the purchase contract, seller to credit buyer on the HUD settlement statement in the amount of $8,000 under the special provisions section.
But yes, it shows bid amount of $38k, then in section 18 says buyer to be credited $8k at closing.
Maybe it's something pertaining to their taxes and they have to claim a $38K loss which would actually be forgiven debt counted as income that they have to pay taxes on, that would be my guess.
A person I know did a short sale with the bank and the difference was about $80K and he has to show that forgiven debt as income and pay taxes on it.
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