Short Sale On House In Chapter 13
If the owners are in chapter 13, and it is not discharged yet, I was told you still did not have to get get any court approval. The 1st mtg was not in the chapter 13. They are foreclosing. The 2nd mtg is in the chapter 13, and I have been told they have already charged off the debt, except they are still getting payments from the owners. The first told me the owners had to get court approval to sell the house. Does anyone know if this is so?
The Homeowners will need the permission/cooperation from their Bankruptcy Trustee to list for sale, or go into contract to sell their home until the Bankruptcy is either discharged or dismissed, or the Trustee abandons it's interest in the property.
Many mortgagees won't consider a short sale while the mortgagors are in Bankruptcy.
Call Trustee in BK and see if he has abandoned claim on property. If so go for it.
Depending on value try and buy. But the second has to be handled. You might try and buy this instrument. You can either remove it from title latter on or you can use it as bid protection at time of foreclosure sale on the first if it goes all the way. Sort of a double shot. Go Hustle on this one, time is a fleeting.
Lucius
Lufos is correct,
If homeowner is working with you towards the Short Sale on this one and 1st mortgage is not cooperative, you may try to acquire a note from the 1st via assignment at discount. Then you can complete the Short Sale yourself assuming Bankruptcy Trustee is not objecting and waive all deficiency judgment against the homeowner.
Dmitry.