Filing Bankruptcy when you have a short sale listing

By
Real Estate Broker/Owner with NoVa Brokers LLC 0225 094634 VA/ 643686 MD

Since I wear two hats, one as a bankruptcy paralegal and the other as a Real Estate Agent I have clients coming to the office to file bankruptcy who have their home on the market for a potential "short sale".  They are being told that you can still sell your home while in Bankruptcy  or Bankruptcy will not have anything to do with the sale by their RE Agent.  In Virginia, if you file Bankruptcy then the listing agreement as all agreements and contracts are voidable and you cannot continue the sale until motions are filed and orders are signed by a Judge stating that you can continue this sale especially if there is a contract being reviewed by the "third party, BANK".  If your seller is considering bankruptcy, you need to refer them to an attorney for the advice and the proper procedures that will need to take place so they can make a more informative decision on "when" or "if" to file their bankruptcy. 

 

 

 

 

 

 

 

http://www.stellabarbour.com/default.asp

 

 

*I am not an Attorney and not giving advice but opinion on previous experience.

Posted by

FOR ALL YOUR REAL ESTATE NEEDS

 

STELLA BARBOUR

NoVa Brokers LLC

1483 Chain Bridge Road Suite 103

McLean, Virginia 22101

571-814-3002 OFFICE

703-999-6104 CELL

571-281-2866 FAX

www.novabrokersllc.com

stellabarbour@yahoo.com

Licensed in Virginia & Maryland

 http://www.novabrokersllc.com/

 

 

 

Comments (5)

David Saks
(retired) - Memphis, TN

Tragically, I've seen clients destroyed financially because they couldn't get the extensions they needed on their listing agreements with area brokerages, allowing them precious time to salvage their lives. They lose their homes, their cars, their marriages, their families, their self-esteem, and in the worst cases, have committed suicide. It's very tragic and heartbreaking when the situation creates unparalleled levels of risk for any man and his wife, their family and children, and they're forced to sell and we have to work against the clock to save them, either through loss mitigation, by locating an investor or other buyer interested in a short sale, or through the court. I hope for a fine week ahead for you, Stella.

Oct 15, 2008 12:05 PM
Stella Barbour
NoVa Brokers LLC - Vienna, VA
Principal Broker, Serving Virginia and Maryland

I know it is tragic.  I saw a case that the contract was being approved by the bank for short sale and client was in Bankruptcy and the sale fell through because the contract was no longer valid upseting everyone involved and the BKY Court rules.

Oct 15, 2008 12:07 PM
Laurie Mindnich
Centennial, CO

I'm not a fan of lawyer involvement ,but in the case of short sales/bankruptcy/foreclosure- all or one- it would seem irresponsible not to insist that the seller get legal advice before ANY decisions are made, or direction taken.

Oct 16, 2008 08:31 AM
Ray Saenz
Exit Realty Laredo - Laredo, TX
Homes for Sale in Laredo, TX - Texas, Realtor

Stella,
Oohhh my god ask me this, I've been in the same boat like the blog that you are sharing right now, hm....  great post !

 

Feb 13, 2010 03:32 PM
Stella Barbour
NoVa Brokers LLC - Vienna, VA
Principal Broker, Serving Virginia and Maryland

Thanks Ray.

Feb 14, 2010 11:53 PM