Can the bank back out after they have faxed a payoff and agreed to a short sale?
We were in the middle of negotiating with amc when the seller gets a letter from a new lender saying they are now servicing the mortgage. So we go to the new lender and within two days we had an accepted price with the bank.
We scheduled the closing, met the seller and signed everything at the title company…however the title company made us close in escrow ( on hold) because they are saying there is no assignment of mortgage to the company that gave us the payoff. It gets really complicated but the original mortgage company sold the loan to a servicer and that servicer had a power of attorney to act on behalf of two or three companies…our issue is that the payoff that we got is from a new servicer that is not on title any where. Will we have to start over? Do we own the property? We have a lot at stake here. Should I call an attorney yet?
Did the new lender actually buy the loan from the old bank or did they simply buy the servicing rights? If they only serviced the loan it seems they have no rights to negotiate a sale price. Similarly, if they have firm power of attorney then maybe you can legally force them to perform under the contract for sale.
Well mystery solved. The Title company approved the chain of title today and sent the payoff… Yeahhhh Team ! ;D