I am a short sale buyer. After more than 3 months waiting, this week my
agent told me she got the bank approval. However, she also told me when
she presents the bank approval to the seller, the seller declined and
refused to go closing.

Has anybody had any experience on how to deal with this? Does the
seller have legal obligation to sell her house after third party
approves the sale?

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Replies to This Discussion

Possibly. But you would have to sue the seller for specific performanace and that rarely works.

Have you and/or the agents involved tried to determine why she won't go to closing? Remember that just because the bank approves the sale doesn't mean that they didn't slip in a bunch of conditions that are not acceptable to the seller. And sometimes it can be something as simple as her misunderstanding the approval.

I would lay out the ramifications of her not going through with the sale in a non-threatening way. Try to get her talking.
Laura. There is probably a contingency somewhere in your contract (normally an addendum) that states the seller has to agree to the terms of the short sale. Review your contract.

The seller declining may have something to do with the lender wanting the seller to sign a note, bring cash to closing or not releasing a deficiency. Really know way for yo to know and unless the seller gives you the reason.

You may want to seek legal advice to explore your options.
We have a contingency in all our seller short sales that says that if the seller does not approve of the terms and conditions that their lender offers for their short sale they don't have to proceed with the contract. This is because let's just say that the bank comes back and says, yes, you can do your short sale but we also want you to pay us in cash, $25,000 but the seller does not have the 25K to give them. He then can not move forward with your offer. You may want to try to find out why he does not want to accept in case there is some compromise he can make with his lender.
Seller had asked to rent back the house and pay a reduced rent after we signed the contract. I agreed even though I don't like the idea.
Ok, but why is she now not going to closing? There has to be a reason for the change of heart.

Laura Ashley said:
Seller had asked to rent back the house and pay a reduced rent after we signed the contract. I agreed even though I don't like the idea.
According to the what the agent told me, the bank didn't ask seller to sign any note or bring any cash. The bank counters my offer and I accepted.
I have asked the agent to find out why the seller not going to the closing, the agent said the seller wont tell the details. I am very confused and frustrated. I think at least I deserve an answer from the seller.
Of course, you deserve an explaination. But you may not be getting one. I was the listing agent with a somewhat similar situation just last week. Seller suddenly changed mind. On day of closing! Sent me an email saying, "I'm not closing." No explaination. Nothing. And then refused to answer phone calls or emails. And as he was physically in another city I couldn't trot over and try and catch him at work. Not that I would get past security anyway :>)

Point is that all you can do is make the request. I am sure the listing agent is trying to get you answers but sometimes a seller (or a buyer) will suddenly change their mind. And if they close themselves off, you aren't going to get a reason.

Sorry for your situation. Believe me, I can relate!

Laura Ashley said:
I have asked the agent to find out why the seller not going to the closing, the agent said the seller wont tell the details. I am very confused and frustrated. I think at least I deserve an answer from the seller.
Wow! That would be frustrating. As stated prior the only reasons I would surmise would be the terms. If not the terms then I wonder if seller has applied for a loan modification or something...I totally agree at the very least you are owed an explanation.
I hope it gets worked out.
Unfortunately, no. You can't make anyone sell.
I had a very similar incident happen to me.
First, and second were agreed, then the seller's hopeless, roomate idiot bums, who had no where to go after the house would sell, convinced the seller to try a loan modification and or a loan forenscis with an attorney. I know how to do loan mods and this seller did not qualify for one. I tried to explain to the seller, to no avail. The bum roommates are still there with the seller, who is in default. I cried, out of anger and could not believe how stupid some people can be. OH well..
Finally I got the words from the seller. The seller is now applying for loan modification.

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