I need help. I have been working with these sellers since April and we finally got an approval to close in January, but I found out last week that the sellers filed chapter 7. Bank of America will not let the transaction close until they resolve the bankruptcy. I emailed them the response from BoA that they need to file motion to sell" and receive the “discharge paperwork, notice of abandonment or case closed order”. They forward the email to their attorney and their attorney respond that he is not sure the bankruptcy judge will approve motion to sell and that the buyer has to appear in court to talk to the judge... Does this make sense? I closed a short sale with bankruptcy filling last year and the buyer did not have to appear..
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I closed one a few years ago, one of the sellers (investment group) file BK. We went to the BK court and got their approval to sell. The BK judge was happy to approve the sale. Didn't have anything to do with the bank, I believe. Been a while, I will check again to be sure.
You need to tell the sellers to contact the BK Trustee send them a copy of the approval letter
and tell the Trustee that youy have the approval which he or she will have and you need permission to sell.
This should take about 2 weeks or so.
Thanks,
Jim
You need to request the Trustee Docket from the BK attorney. The Docket will show case# and Trustee name, number and fax number. You need to file a motion to sell with the Trustee. You need to provide the Trustee with these items: HUD1, contract to purchase and Lenders approval letter for short sale. No funds from short sale can be given to the seller. Once its been provided to the BK Trustee allow 20 days for an approval. As long as there ZERO equity and the trustee and confirm this should be approved ASAP.
you should have the attorney who is handling the bankruptcy for your client prepare the paperwork.
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