Now for the second interesting transaction that I have run across in the new year.
I have been representing a purchaser that was purchasing a REO. "REO" stands for "real estate owned" and refers to a situation where a bank consummates a foreclosure action and then takes the property back at the auction and sells it. Of course, as the bank has already lost a tremendous amount of money, its goal is to sell the property as quickly as possible. Indeed, banks are not in the business of managing real estate and instead are in the business of...(well, let's keep reading and try to think what possibly banks could be in the business of).
My clients purchased the property at $370,000.00. However, they were advised that in order for their offer to be accepted, they had to apply for a mortgage with a lender who is affiliated, as in partly owned, by the selling bank. My clients did so but the bank that they applied to dragged their feet and the transaction became protracted. Parenthetically, this kind of "service" often occurs when someone is compelled to use and isn't given free choice.
My clients eventually went to another bank who quickly gave them a mortgage commitment and we want to close. The problem is that the selling bank refuses to close. First they defaulted my clients and tried to forfeit their down payment. I responded with a few emails and letters and they relented and refunded the down payment. However, my clients don't want their down payment back. They want the house.
Now here's the punch line. Even though my clients are ready to close at $370,000.00, the bank has relisted the property at $350,000 and is trying to sell it to a third party. Thus, they will lose at least $20,000 when they finally do find another purchaser. Of course, who knows how long that will take and what price they finally end up selling at.
My clients have not relented and instead we have commenced action to compel the bank to sell and placed a lien against the property I will hopefully be able to relate some good news in the near future.
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5 comments:
Great post, it was excellent and I really like it. I had a great time reading it. Big thanks and keep posting.
Charles A
A stimulating, informative, and most enjoyable post. This reader was riveted. Clearly, this attorney is a deeply passionate advocate for his clients whom, no doubt, feel confidently guided by the experienced and skillful hands of his expertise.
One can't be too careful when seeking legal counsel these days. It's all too easy to fall prey to arcane agendas or misrepresentation from a "well-intentioned" lawyer which may leave one with a painfully sad, long, lingering, and bitter taste in one's mouth. However, that most certainly isn't the case with the eloquent blogger, SKA ESQ, whose writing is refreshingly devoid of misspells or poor grammar save for a couple of sentences which end in a proposition. Although, the brilliant author may have simply taken liberties with poetic license; my own humble conjecture.
Heartfelt thanks for "Mitigating Damages in Reverse." Should I find myself in a similar scenario, I shall be well-armed by the knowledge that SKA ESQ has imparted. Looking forward to many more posts...
- Zil
Bank of SCAMerica
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Great text and nice blog.
Orlando Short Sales
Nice blog..very informative post...you shared really good information..keep posting.
Jeffrey T. Angley
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