we closed on a short sale and the next day was told the house wasn't ours
We just had a situation with a short sale that everyone has said they have never heard of. I'm curious what you all think about this and what advice you may have.
We had a contract signed by the seller and preliminary approval letter (from Chase- the short sale bank.... sorry I don't know all the terminology). The approval letter said Chase understood that closing was to take place on or before September 24, 2010. We closed at 4pm on the 23rd. As we were leaving the closing we heard the closing attorney make a comment to the realtors that they had not gotten the disbursement information but that since they had the approval they would get it the next day and pay the realtors then. We didn't think anything of it as we had turned in our money, signed everything and had the key in hand.
The afternoon of Sept. 24, 2010 I got a call from our realtor that there was a problem, the house wasn't ours and we needed to stop all work on it (I was in the middle of cleaning, taping to paint, etc. when she called).
Apparently, there was a USDA approval for the sale that had expired (so far no one has been able to tell me when it expired relative to the 9/24/2010 date that Chase intially cited in their approval letter). The Chase negotiator said he had requested an extension but had not heard back from the USDA. He says he told the listing agent on 9/22/2010 not to proceed with the closing until he heard back from the USDA.
Our closing attorney has since admitted that they did not get the HUD to Chase 72 hours in advance for final approval, they sent it 24 hours in advance and never heard back from Chase but proceeded with the closing anyway.
I think several people are at fault here:
- the negotiator should not have given us a preliminary approval for Sept. 24th or before without telling us that there was another approval from USDA that was about to expire, and we were never notified that it expired
- the listing agent didn't pass along the information from the negotiator (assuming she received it.... which wouldn't surprise me as we had some concerns with her in other areas as well)
- the closing attorney should of course never have closed without final approval from Chase (I think they knew something was up too as we were notified on the afternoon of 9/24 and they still had not deposited our check into escrow from the previous day)
Any thoughts? We're hoping to heard on Monday that the USDA extension was granted.... I have no idea if it will be or what precedence we have to think that the extension might be approved. We have to be out of our current living situation in two weeks.... no enough time to find another house to buy.... not sure what will happen if this doesn't go through.
We had a contract signed by the seller and preliminary approval letter (from Chase- the short sale bank.... sorry I don't know all the terminology). The approval letter said Chase understood that closing was to take place on or before September 24, 2010. We closed at 4pm on the 23rd. As we were leaving the closing we heard the closing attorney make a comment to the realtors that they had not gotten the disbursement information but that since they had the approval they would get it the next day and pay the realtors then. We didn't think anything of it as we had turned in our money, signed everything and had the key in hand.
The afternoon of Sept. 24, 2010 I got a call from our realtor that there was a problem, the house wasn't ours and we needed to stop all work on it (I was in the middle of cleaning, taping to paint, etc. when she called).
Apparently, there was a USDA approval for the sale that had expired (so far no one has been able to tell me when it expired relative to the 9/24/2010 date that Chase intially cited in their approval letter). The Chase negotiator said he had requested an extension but had not heard back from the USDA. He says he told the listing agent on 9/22/2010 not to proceed with the closing until he heard back from the USDA.
Our closing attorney has since admitted that they did not get the HUD to Chase 72 hours in advance for final approval, they sent it 24 hours in advance and never heard back from Chase but proceeded with the closing anyway.
I think several people are at fault here:
- the negotiator should not have given us a preliminary approval for Sept. 24th or before without telling us that there was another approval from USDA that was about to expire, and we were never notified that it expired
- the listing agent didn't pass along the information from the negotiator (assuming she received it.... which wouldn't surprise me as we had some concerns with her in other areas as well)
- the closing attorney should of course never have closed without final approval from Chase (I think they knew something was up too as we were notified on the afternoon of 9/24 and they still had not deposited our check into escrow from the previous day)
Any thoughts? We're hoping to heard on Monday that the USDA extension was granted.... I have no idea if it will be or what precedence we have to think that the extension might be approved. We have to be out of our current living situation in two weeks.... no enough time to find another house to buy.... not sure what will happen if this doesn't go through.
Replies to This Discussion
-
Permalink Reply by Mike Horton on
-
The closing instructions usually has quite a bit of wording that states on the requirements for a successful close and that often contains wording to the effect that the final hud must be approved before the closing can occur. I would look closely at the agreement letter from Chase and determine what it says. Better yet you should probably invest in a real estate attorney to review the facts of the case to see what legal options you might have.
© 2024 Created by Short Sale Superstars LLC.
Powered by
**********************************
like buttons