What is our recourse to continue purchasing this home?
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What is our recourse to continue purchasing this home?
We were supposed to close on a property last Wednesday. On Tuesday night we were notified that closing would not take place because they discovered a 3rd mortgage on the property adult children selling for deceased parents. They would need to bring 43k to close to settle all the liens which they do not have. The next day they were in with some short sale negotiater to try and get the 3 lienholders to agree. However, we’re under the impression this could take months
but have had pretty much zero contact with the other side to see where they’re at in the process or the likelyhood this will happen at all. The other agent told our agent she’s out, short sale negotiater is who we should now deal with to get
answers. We’ve heard nothing. Technically we’re still under contract to purchase, which they’re currently in breach of. But what real recourse do we have to get this done?
Asked on October 15, 2018 under Real Estate Law, Missouri
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
You can't safely get it done, unless you can and are willng to pay the $43k in liens:
* You can bring a legal action (lawsuit) seeking "specific performance": that is, seeking a court order compelling the seller to carry through with her contractual obligation and sell to you. However--
* Getting a court order the sale does not wipe out the liens: they will still be on the property. Mortgages, even 3rd mortgages, come due when the property is sold--therefore, the mortgages will have to be paid at closing. If they are not paid at closing, the lender can foreclose. So if the seller cannot pay off the 3rd mortgage, you can get the house and then promptly lose it to foreclosure unless you pay the loan yourself.
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