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While working with a buyer looking for a short sale in Four Corners Davenport, FL yesterday, we happened upon a home that was listed twice in the MLS. It was listed once as a short sale for $87,000 and once as a regular sale (or equity sale) for $99,000.
Before even thinking about showing the home to the buyer I called both agents to try to get to the bottom of the situation. The first listing was a short sale. The second listing was a Realtor who bought the home at auction to flip it about 30 days ago. I looked in the tax records and sure enough he is the legal owner of the home.
When I spoke to the agent who had the home listed as a short sale he had no idea what I was talking about. He told me he’d call me back when he was done investigating. About 3 hours later he called back, but by that time I already knew what had happened. He had been working with the seller trying to sell the home as a short sale for about the last 4 months. The seller hadn’t paid their mortgage in quite some time and the bank had sold the home at auction since they hadn’t gotten a buyer under contract.
The listing agent nor the owner (who was in another state) were never made aware that this had happened. This is something that can sneak up on you and really ruin your day (or worse) if you aren’t watchful. Now the seller has had him home foreclosed on and lost all of his possessions that were left in the house and he never even knew it until it was too late to do anything about it.
I think the solution was to reduce the price to a point where they could have gotten a buyer under contract. Would it still have been foreclosed on? Maybe, but at least the seller would have had a fighting chance at a short sale. I checked the history and the agent hadn’t done one price reduction in 4 months while the property languished on the market not getting showings and not getting offers.
The moral of the story is stay on your toes or your lender might just sneak up and bite you on the....
Image courtesy of thecrazyfilmgirl at flickr
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