What would you do? (auction, foreclosure, agent, sales)

[kimba01]

Short sale on the house after listing it the "old-fashioned" way and not getting any bites. Listed in Feb. 2011. First offer was cash. Bank turned it down over $7000. Buyer didn't stick around to play. Next offer, buyer changed their mind after a two days. Current offer $12000. lower, bank accepts with waiver of deficiency but must take $2500. to table. Fine. Buyer's mtg doesn't go through as they are from Canada (was not aware of this at the time) and they have no American credit. Bank is worried they are doing a buy and bail. Fine.

In the meantime, home is scheduled for sheriff sale on 12/15. Buyers still want home and will pay cash, but cannot get to the cash until January 9th. Apparently for tax purposes. Agent is saying stay with it and continue to do the sale even after the sheriff's sale. But that the process would have to start all over with the bank and could be a different result.

Has anyone experienced doing a SS during the redemption period? And if so, what is the point? If you are going to be hit with a foreclosure anyway? The hope of a SS (I thought) was that it was less of a hit on your credit. You might as well stay the 6 months if that is the case.

[NinaN]

Banks often delay the foreclosure auction (I guess sheriff's sale in your state). Perhaps your agent is saying to stay with the short sale in case this happens.

However, once the bank forecloses, I don't believe you can use a short sale anymore. The redemption period gives you time to bring the full amount owed, plus late penalties and foreclosure costs, to the bank. Short sale proceeds probably won't cover that much.

But once again, there could be an exception I don't know about. Anyone?

[FalconheadWest]

Are these true sales prices? The property is worth somewhere around $12k? What lender gives loans on such a small amount? That's probably the reason the buyer couldn't get financed.

[kimba01]

Originally Posted by FalconheadWest

Are these true sales prices? The property is worth somewhere around $12k? What lender gives loans on such a small amount? That's probably the reason the buyer couldn't get financed.

Sorry, guess I wasn't real clear. The offer the bank finally accepted was $12,000. lower than the first cash offer that they rejected!

The RA is saying that they will still sell as a short after foreclosure. He is saying that like it is a normal occurrence. As far as them holding off the sheriff's sale, the short sale specialist on this case, says they are cracking down on that. I don't blame them, too bad they didn't do it long ago. But, one wonders, then, what would be the point of doing the short AFTER the foreclosure, if it is even allowed as the agent says it is? I suppose it would depend on whether the bank was willing to still do the waiver of deficiency. That would seem to be the deciding factor. You might think the bank would not want people to stay in their homes for that redemption period.

I do know of some banks offering homeowners money for their keys just so they don't stay during that time. But that comes after the foreclosure.