Escrow opened on my Short Sale right after I filed

[bk442]

I have had my house up for a short sale for almost a year now. Offers came, and offers fell through. Finally an offer came in about 3 months ago. Well BofA has finally accepted this offer. However, I filed BK about a day or 2 before they opened escrow. What is going to happen? I haven't told my Realtor about the BK yet, kinda afraid to. Are they going to have to wait it out until my BK is closed? Just wondering, it really does not matter to me as its all being discharged anyway, but I thought I would help my agent out.

[Bkman2]

You need to tell your agent. Is BofA your only mortgage or do you have a second also? There are to many things that need to clear before an escrow is on auto pilot. Letter(s) from lender giving "OK" to the sale, clear title for the sale, buyer's appraisal/inspections passed. BofA will find out about your pending BK and its better for them to do the short sale but you never know with BofA. Good luck!

[bk442]

You need to tell your agent. Is BofA your only mortgage or do you have a second also? There are to many things that need to clear before an escrow is on auto pilot. Letter(s) from lender giving "OK" to the sale, clear title for the sale, buyer's appraisal/inspections passed. BofA will find out about your pending BK and its better for them to do the short sale but you never know with BofA. Good luck!

BofA is on the 1st and 2nd. They agreed to the short sale literally a day or 2 after I filed. I haven't seen or signed any letters from BofA about the sale yet though.

I told her yesterday in an email that I filed BK. She seems a little upset, wants to know if I can back out of the BK lol. I told her that when I filed, it didn't look like the short sale was going to go through, that the house was not the only reason I was filing etc.

Anyway she said the short sale can't continue until BofA either gets relief from stay, or after I am discharged. Is this true? There has already been an appraisal and a septic inspection and some other stuff since escrow opened.

I would rather just forget the short sale altogether and get 3 or 4 more months of free rent in my house and possibly cash for keys. I kind of hope it falls out of escrow now. I know she will lose out on commission but I need to look out for myself as it now looks like I could be laid off at work very soon. Every penny I can save from now on will make a big difference in the rebuilding process for sure

[justbroke]

Since you filed, all your property is now property of the Bankruptcy Estate. You no longer have control or the right to sell anything until the items are abandoned, or your case is dismissed, discharged and/or closed.

You will need to get permission to sell the property through the Trustee and Court. Work with your attorney so that you can get the proper motion before the court to allow you to sell the property. You'll need the Trustee's permission.

Now, the Trustee is going to dig and see if there are any issues with title before they are going to allow it to be sold (abandoned) from the Bankruptcy Estate. It may be a non-issue.

There is really nothing for you to "worry" about.

[Bkman2]

Not sure how it is where you live but in Nevada you need a letter from the first and the second to sell under a short sale. The owner signs the contract but the bank covers the terms in a letter (agree to the sale, close date, commission to brokers....etc). If the trustee clears the sale that doen't mean you ae 100% in the clear. In most cases the 2nd will clear the lien on the home but still trys to collect the money owed. The difference from what you owe and what the bank gets can become a new tax bill to you. You should really talk to your attorney and see what the best option is for you. "cask for keys" may go to the trustee.

[bk442]

Not sure how it is where you live but in Nevada you need a letter from the first and the second to sell under a short sale. The owner signs the contract but the bank covers the terms in a letter (agree to the sale, close date, commission to brokers....etc). If the trustee clears the sale that doen't mean you ae 100% in the clear. In most cases the 2nd will clear the lien on the home but still trys to collect the money owed. The difference from what you owe and what the bank gets can become a new tax bill to you. You should really talk to your attorney and see what the best option is for you. "cask for keys" may go to the trustee.

According to my attorney I'm in the clear as far as taxes and canceled debt are concerned.

Quick google:http://eastsac.housingstorm.com/2010...n-real-estate/ (For my CA state taxes, thank you Arnold)

And the federal is covered by the Mortgage Forgiveness Debt Relief Act Of 2007

So I'm not too worried about the short sale happening or not. I didn't think I'd get C4K anyways but it would be nice. I guess I'll just let it play out. It'll either short sell or it won't. I'll keep you guys posted

[jmanford]

Justbroke is right. You will need to get Trustee Approval. That is what my attorney told me.