Ozaukee & Washington County Real Estate

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We Have a Defective Foreclosure -- Huh?!?!

So I'm not even sure where to start on this one...

About a week ago my sister-in-law mentioned that she saw a notice in the local newspaper that a house I had an accepted offer on was going to sheriff's sale in mid-September? Huh?!?

question mark

The offer was accepted by the bank, the inspection was scheduled, and the buyer's financing was underway. So I brushed it off as some sort of error.

But then I checked yesterday's issue of the same newspaper, and lo and behold -- there it was. A sheriff's sale is scheduled for 1:00 pm on September 17 at the county courthouse. Huh?!? How could this be??

So I emailed the listing agent who called back a short time later. "We have a problem." Huh???

He proceeded to tell me that after a few phone calls he was able to talk with the foreclosure attorney for this house and was told there were actually two mortgages on this house. One had been foreclosed but the other -- well, not so much.

So you know that offer I said was accepted? It meant nothing. And the listing contract this agent had with the bank who supposedly now owned the house? It meant nothing. And the bank who supposedly owns the house? They don't. The original owners still do. And that's why there's a sheriff's sale at 1:00 pm on September 17 at the county courthouse.

I believe the listing agent called this a "defective foreclosure." Huh?!?!

So I called Mrs. Buyer and explained the situation as best I could in the stunned state I was in. Her reaction was, well, shock -- dismay -- confusion -- huh?!?! How could this be???

The buyers can get their earnest money back, but as far as the money they forked out for a home inspection and appraisal -- well, that is yet to be seen.

So who dropped the ball on this one? Who's to blame for this HUGE oversight? The title company? The foreclosure attorney? And will the party or parties ever be held accountable for this huge mess?

My head is still spinning on this one. I don't know what's going to happen next. Will the buyers wait to see if the house goes at the sheriff's sale? If it doesn't sell at sheriff's sale, will they consider writing another offer? Should they consider writing another offer? Should they just move on to another house? Hmmmmm....

I have to admit my experience with short sales and foreclosures is pretty minimal, especially compared to many other agents out there. But this is a new one. A defective foreclosure. Have never heard mention of that possibility before.

Can't wait to see how this story ends...

 

Peggy Wester
Phone: 262-370-1757
Email: pwester@realtyexecutives.com
Website: peggywester.com
Blog: peggysblog.com


Peggy Wester - Realty Executives Integrity

Comment balloon 7 commentsPeggy Wester • August 14 2009 08:13PM
We Have a Defective Foreclosure -- Huh?!?!
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