Here is interesting news for owners in foreclosure and sellers trying to do a short sale. I don't know about you, but I've been in the middle of short sale transactions when a listing agent calls to say that he represents the bank, which has just foreclosed, and will I please remove my listing from MLS so he can put his REO into inventory?
And just like that -- poof -- the short sale transaction is no longer viable. It disappears. The seller no longer owns the property, I no longer have a listing, and the shocked buyer has to call the movers to cancel.
Yet, somehow, this can be reversed. How do I know? Because Rep. Laura Richardson has found a way to bend the rules.
California Foreclosure Process: You know the rules. Everybody knows the rules. You miss a few months of mortgage payments, the lender sends you a notice that says it intends to foreclose. A few weeks later, you receive a Notice of Default.
The Notice of Default is also recorded in the public records because it is considered to be constructive notice to, guess who? The public. Everybody in their underwear has a right to know that your home has gone into default and is headed for a trustee's sale. Ninety days go by, and then a notice of impending sale is published in a newspaper of general circulation for 20 days.
Then the trustee's sale is held and the home goes to the highest bidder. If nobody bids enough, it goes back to the lender.
Rep. Richardson's home at 3622 West Curtis, in Sacramento's desirable Curtis Park neighborhood, sits at the corner of West Curtis and Coleman on a tree-canopied street. It's one of three homes she owns, and this is her 7th or 8th time in foreclosure, I forget which. The facts are Richardson defaulted on this mortgage and now claims to have been in the middle of negotiations with the lender when the home was sold out from under her, without notice (cough, cough), at a trustee's sale in May to James York, a mortgage broker. Hey, many sellers have walked in those shoes.
However, now, Rep. Richardson has persuaded the bank to rescind the trustee's sale, even though York has recorded his deed and taken possession of the home.
What I'd like to know is how can the rest of us ordinary citizens and real estate agents undo a trustee's sale? What do we need to do to save our escrows, our sellers and their homes? Rep. Richardson says she is not receiving special treatment. Then, how did she do it? Perhaps she'd like to share how it's done with the rest of the world.
Here's her contact information -- in case you'd like to write to her to find out the secret:
The Honorable Laura Richardson
United States House of Representatives
2233 Rayburn House Office Building
Washington, D.C. 20515-0537
You can send an email to Rep. Laura Richardson, too.
Photo: Big Stock Photo
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Certified HAFA Specialist
My Sacramento Real Estate Listings
Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout the four-county Sacramento area. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. Broker-Associate at Lyon Real Estate. DRE License # 00697006.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com.
Lyon Real Estate is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.
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The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
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You have got to be kidding! Wow...
I wish I were kidding, Melina. But this story is real. You can watch the video which is linked to the property address above. A reporter interviews her neighbors and takes you inside the home. It doesn't appear to be in very good condition.
No doubt, inappropriate pressure was put to bear to get this outcome, but it's always possible there was valid reason.
Hi Joe: Hard to say if there was inappropriate pressure. The only two things I know are this woman figured out a way to undo her foreclosure, and it didn't have a darn thing to do with home equity sales act.
I know an area Attorney who had a client who was able to reverse the sale. My understanding of the case is that the mail man thought the home was vacant so he/she never tried to deliver any certified letters to the elderly borrower. For this reason (from my understanding) the Judge reversed the sale if the Son could bring in the money by the next day. I guess there are always loopholes. Erin
It is a terrific question. It would be interesting to see if we can get the answer.
Wow Elizabeth, really? That is absolutely crazy!! Her attorney is probably well paid! ;-)
We're a Trust Deed state as well.......don't like short sales at all -- too risky for my buyers. AND the other agents are always up to speed on how it really works. ;-)
ummm makes me fell pretty darn good -
Incredible. Wondering how many lawsuits will come up over this one. How could she not say she got special treatment.
You're either on the inside or you're not. There ain't no in-between.
If there was some funny business it may well come to light the next time she runs for office.
Nice catch, Elizabeth. The reversal could have hinged on a delivery of notice technicality. It's interesting that the lender first tried to buy the house back and then filed to rescind the sale. I don't necessarily see sinister on the part of Richardson... she hasn't been in Congress long enough to have any real clout and no committee assignments that would give her undue influence. It will be very interesting to see how this plays out.
Hi Teri: Well, that's if she actually pays her attorney. Some of the articles about Rep. Richardson say she has a habit of not paying those she hires.
Hi Jesse: I wouldn't call it "sinister" either. But to claim ignorance when you've been in that spot a half dozen times doesn't exactly hold any water. But I'll be watching how this develops because little is worse than trying to work out a short sale or redemption with a lender, being assured the trustee's sale will be postponed, and finding out later the left hand didn't know what the right hand was doing.
Elizabeth, and WE vote for these people and pay their salaries? How disgusting!
Hi Teri: Not to mention you've got Senator Dodd leading efforts to help subprime mortgage borrowers, who is calling Countrywide's practices "abusive," and then going directly to the CEO of Countrywide for a loan. And there's also Senator Conrad who been buddy-buddy with CEO Mozilo of Countrywide. Both say they didn't get special treatment, although loan points were lowered or waived for them. Conard said he just called up the CEO to compare rates and never for a single moment expected preferrential treatment.
Yeah, like the average citizen can call up Countrywide's CEO and ask for a mortgage loan. Right. Everybody in the country who shops for a loan has access to guys like Mozilo.