Expert: Diann Tonnesen - 11/13/2009

Question
QUESTION: Hi Mrs. Tonnesen, I need help resolving a scenario concerning a vacant property I am interested in purchasing.I have been forwarded to five different realtors, including the owner. I have researched the property-I now know, the property taxes are behind(at least two years)and the owner has filed bankruptcy.I have tried to setup a time to view the property and get price information, however none of the contacts have returned my calls regarding sales price.

I seem to have come to a dead end.

I'm not sure how to pursue this any further.

Can this property still sell-despite the bankruptcy?

Your comments are greatly appreciated.


ANSWER: Hello, Georgia Peach! (I am assuming that is what gapeach stands for?)

Is this property currently listed? If it is not, the real estate agents don't have access or permission to show it, which is why you are probably not getting return calls. Is the owner an agent? Have you tried going in to a real estate office in person to talk with an agent? That would be my next step. That way you can sit there while phone calls are made on your behalf.

The property would have to be removed from the bankruptcy in order to be sold, but that can be done with a little effort on the seller's part IF the property was the seller's personal residence. If it was an investment property, then it probably cannot be removed from the bankruptcy and you will have to wait until the bankruptcy is discharged.

Hope this helps a little and good luck!


---------- FOLLOW-UP ----------

QUESTION: Mrs. Tonnesen,

Thanks for your prompt response. The property is not the owners primary residence and it has not been listed yet. I have spoke with a realtor concerning the home-I don't feel as though any progress is being made or perhaps I'm not being taken seriously. The owner has provided me with all the pertinent information concerning the purchase, including the price. I want to view the property but the owner is out of state and the realtor wants to verify additional information before showing the home to me. I feel as though I have an advantage right now, because the property is "undiscovered". I'm afraid the realtor will procrastinate and I'll end up and a bidding war with investors. Is a realtor required? Are there any ways around this process?

I am sure you will guide me in the right direction.

Thanks again!

Answer
If the property is not yet listed, the real estate agent probably does not even have the authorization to show it to you. If you are in contact with the owner, perhaps they have a neighbor or relative living nearby that might have the keys? Otherwise you will have to wait for the agent to show it to you, which might not happen until he/she has a signed listing agreement in hand. And that might not happen until after the bankruptcy has been discharged.

If the property has not yet been listed you could actually have a purchase contract written up and submit it directly to the seller. The contract would be contingent on you actually viewing the property and having a due diligence period to perform inspections, as well as a contingency about the bankruptcy. It is also possible that more is owed on the property than it is now worth, and then the offer would also have to be subject to the existing lender's approval of a short sale which could take up to six months. If the seller is willing to execute (sign) the contract on those terms, then you would have first rights to the property at the agreed upon price. There are a lot of "ifs" involved in this transaction, so you will need to have a lot of patience!