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richkat2 · Joined: 30 Dec 2009 Posts: 1 1.00 Dollars($)

We have been in the process of purchasing a short sale for nearly 2 months now. As time progressed we were informed that the second lienholder is a collection agency. The seller and the first lienholder accepted our purchase bid. The second was offered 10% by the first, but demanded 20%. A verbal agreement was made for the 20% but when it was time for documentation changed their minds and said they want the full 30%. The first has refused to give them more than the 20% and has decided to foreclose in 2 weeks if the second does not accept the 20%. The realtor tried to get us to increase our purchase amount in order to make more funds available to the second. The first said that that would make no difference because any increase in purchase price would go to them (the first). I believe the realtor is about to ask us to pay off the collection agency's demand for $5,000. or lose the sale to foreclosure. What about all of this? Is this legal? We still want to purchase this house!!

adonis · Posted: Wed Dec 30, 2009 11:53 pm Post subject:

Hi richkat,

If the collection agency does not accept the 20% that the first lender is offering, then they can foreclose the property. The first lender has the rights to do that and it is quite legal for them to do it. You may then purchase the property from the foreclosure sale. If you want to buy a property immediately, then you can check out other properties that are short selling in your location and bid for any one of them.

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Purchasing a short sale, second is a collection agency. Help!!