If a homeowner is going to foreclosure and files bankruptcy right before the auction, how do I still purchase the property if the lender has already approved a short sale?
Please post other tidbits of knowledge you may have on this issue so we can get some good information on the subject.
If I’m not mistaking, the bankruptcy simply postpones the foreclosure process, it doesn’t stop the property from being able to be sold. It only stops the forced auction sale. However, if I were the owner, why would I sell, I just bought me some time with the BK!
The short sale can still go through, it just has to be approved by the bankruptcy trustee.
That’s good information. I guess it would be better also if there was no equity in the property. I have one situation now where a woman only owed 6k on her home. She got into financial trouble and fell behind, got foreclosed and filed bk. There has to be at least 40k equity. I offered to bring her current and get deed sub/2, that, and 20k moving money should be fair. I would think that for her it would be the best route, she would avoid the foreclosure and get some money to rebuild. Would I have to worry about liens being put on the property or is her home exempt from creditors while in bk?
The trustee isn’t going to allow the sub 2 transaction. He will do a sale for market value.