A Metro Detroit Sheriff sale should not affect your short sale offer unless somebody other than the bank buys the property.
I had another agents client call me about this the other day. He had an short sale offer in on a $800,000 Livingston County lake front property in the Pickney area. It had been dragging on since August with an out of state bank. He didn’t think there was much progress.
His agent couldn’t answer his questions. So here is was my answer to them.
Here are the two scenarios:
1.) Somebody other than the bank buys it at the Metro Detroit sheriff sale. If an person buys the home at the Michigan sheriff sale the bank is now out of the picture. The homeowner can redeem the property for the the sheriff sale price. So now if you are the buyer your price you offer needs to cover the sheriff sale price, the back taxes, the sales transfer tax, the title policy and the real estate commission.
BEWARE of trying to go behind the real estate agents back. If you have a buyers contract or the seller has a listing contract one of you will be on the hook for the commissions. So be sure that it can be done with paying all of the above.
2.) If the bank buys the property back you continue on trying to get the short sale done. You know only have 6 months to get the deal completed. After that it becomes a foreclosure and who knows how long they will take to get the foreclosure on the market. So if the Metro Detroit sheriff sale take place and the bank owns it…. continue on.
Of course the third scenario you could always take the chance to drop the short sale and wait for the foreclosure. But that is iffy. Somebody else could buy it as a short sale or you could miss it come out when it comes out as a foreclosure.
These are my thoughts on how a Michigan sheriff sale affects a short sale offer. I hope that guy gets his Livingston County waterfront property thru the short sale.
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