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Old 02-20-2010, 08:54 PM
 
4 posts, read 16,248 times
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My husband and I recently found a house to buy. The house was a foreclosure and was an excellent deal. We made the offer and it was accepted. We were shooting for a closing date of March 1st. On Feb.17th my Realtor called and said there was some confusion as to if the house was a foreclosure or not. Basically what has happened is that after the original owners lost the house to the bank, the bank was selling the house to Fannie Mae. Somewhere in the mix the attorney doing the paper work dropped the ball and didn't file all of the paper work. So technically the house didn't belong to Fannie Mae even though they were selling it to us. The are trying to get us to sign papers relinquishing the sale which we refuse to do. I understand that they can't sell a house that doesn't belong to them but isn't there a law against putting a house on the market that you don't own and entering into a contract dealing with this house? I love the house and I would buy the house from whoever owns it, but I feel as though we have been done horribly wrong and there should be some kind of consequence for what has been done. Where do I stand legally with all of this?
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Old 02-20-2010, 09:00 PM
 
28,461 posts, read 78,137,297 times
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While you no doubt feel wronged, the odds of a court siding with your are remote in the extreme.

Basically I have seen a very small number of lawsuits succeed when a seller "backs out" and the keys to winning is when you have clear evidence of "bad faith" on the part of the seller, like when they back out at the last minute and then proceed to sell to another party for significantly more.

The situation you are in is NOT like that.

In fact I suspect that you could get an attorney to help negotiate an agreement that you will "hold them harmless" for their screw up if they allow you to make an offer once everything is straightened out -- which is ultimately want you really want anyhow...
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Old 02-20-2010, 09:51 PM
 
4 posts, read 16,248 times
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Okay what I just found out is that after signing our purchase agreement, Fannie Mae wants a release of sale because a short sale has went through and they can't sell the house. What should we do?
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Old 02-20-2010, 10:07 PM
 
Location: Salem, OR
14,929 posts, read 36,641,854 times
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Quote:
Originally Posted by sheilashare View Post
Okay what I just found out is that after signing our purchase agreement, Fannie Mae wants a release of sale because a short sale has went through and they can't sell the house. What should we do?
You can't do anything. They don't have the legal authority to sell the house.
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Old 02-20-2010, 10:10 PM
 
28,461 posts, read 78,137,297 times
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Default Get an attorney if you want, but realistically...

Quote:
Originally Posted by sheilashare View Post
Okay what I just found out is that after signing our purchase agreement, Fannie Mae wants a release of sale because a short sale has went through and they can't sell the house. What should we do?
I think the only sane thing for the seller to do is admit they screwed up, the odds of you getting anything are remote, but the odds of you delaying things could be great SO they ought o consider giving you something. Did you spend any money for inspection? Take time off work? Anything that a court would consider 'monetary loss' -- MAYBE you could get the seller to reimburse that, but I would not hold my breath.

How's the song go? "I fought the law and the law won..." Fannie Mae, is more than ever, practically part of the Government. Long odds...
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Old 02-21-2010, 12:19 PM
 
845 posts, read 2,181,651 times
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Always a good idea to check ownership at the courthouse, before making an offer.
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Old 02-21-2010, 12:30 PM
 
Location: Salem, OR
14,929 posts, read 36,641,854 times
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Quote:
Originally Posted by adolpho View Post
Always a good idea to check ownership at the courthouse, before making an offer.
That's what I find weird about the situation. At least out here we get the latest deed from the title company at listing time. It's one of the required items in our real estate files.
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Old 02-21-2010, 03:54 PM
 
Location: A little suburb of Houston
3,702 posts, read 17,237,823 times
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Seems like this paperwork mix up and inability to grant clear title by the bank or foreclosing company is happening more and more often.
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Old 02-21-2010, 05:34 PM
 
Location: Salem, OR
14,929 posts, read 36,641,854 times
Reputation: 15336
Quote:
Originally Posted by Poltracker View Post
Seems like this paperwork mix up and inability to grant clear title by the bank or foreclosing company is happening more and more often.

It is. That is why title insurance is essential on a short sale or foreclosure.
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Old 02-22-2010, 11:19 AM
 
Location: Houston area
1,408 posts, read 3,786,574 times
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When you signed the contract to purchase the home, you also had to sign foreclosure addendum. Did you not? These addendum should have tons of clauses and stipulations allowing the bank to do many things they wouldn't be allowed to do under a regular contract. With no real recourse by you.

If you did not sign these papers, then you might have recourse. But at least here in Texas, and I assume all across the US, your offer will NOT be accepted until you sign this.
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