We made an accepted offer for a short sale in Las Vegas, NV using the sellers lawyer. At the beginning title showed 2 loans on home and lien from Credit card. We went through inspection, appraisal, additional roof inspection/certification, had to put in earthquake straps on water heater to bring up to code at our expense, another $110 to have re-inspected. The lawyer has told us 2 times ready to close then not, then ready to close 3rd time and lien from Discover was not addressed- we're told they want their money..owner will have to file bankruptcy and we can walk away or wait...lawyer asks credit card if settle for 10%....but owner still has no money to pay it....we were buying the fridge from owner and agreed to pay the 10% as settlement for fridge...waited 48 hours-no answer from credit card....they were filing bankruptcy....credit card company gets to them next day....agrees to 10%-we wire money and now told we can close on July 3rd for the 4th time. We wire rest of down payment. We do the walk through on July 2nd-still some stuff in home-agree we close on 3rd then owner has several days to finish leaving. Spend most of July 3rd waiting for funds to transfer to title company....Get call from lawyer-they filed the bankruptcy, then when Credit Card Co. came through they pulled it and it showed up on final title report during last search before funding. I think they did something shady if not illegal. Lawyer says now to wait for owners bankruptcy court date-should be within 30 days and what will happen is if we still want house, they get approval for short sale and we can still buy the home. We get notice 10 day later court date is July 30th. We wait all day by phone, my realtor calls and tells me she finally heard from lawyer. She's told that she (the lawyer) was not the one that went to court that day and left early so did not know what happened would call her tomorrow. Next day we are told the date was changed earlier for 2 weeks later (No one bothered to inform us) and at that time it would still be several weeks till we would know if he could short sale his home. That was enough-we walked away! Their ineptness was more than we could stand any longer. We knew the risk of purchasing a short sale property-but this was just ridiculous!
I am willing to get my own lawyer but I don't know if there is anything we can do to recoup some of this money and wire transfer fees because of their lack of knowledge is there? Contract states we don't get anything back. The earthquake straps we bought and my husband installed with permission of the home owner because contractors wanted almost $200. Cost us $21 for supplies and one hour of time. Can we recoup at the least the money for parts and something for my husbands time from the homeowner? I figure all I can do is send him a letter and ask? Thank you for your time in my matter!
2 Answers from Attorneys
You state that "Contract states we don't get anything back." In Nevada, every short sale depends on the agreement of all parties, including lien holders. It is risky to "invest" money or time or effort on such a remote contingency, before all agreements are in place.
Your attorney can explain further.
Mr. Malikowski is correct in saying that you made a risky investment when you put money into a property that was not yours. Given that the owner is now bankrupt, in order to collect any portion of that back you would have to get in line with all the other unsecured creditors to whom he owes money. The likelihood of you collecting anything is remote. If your husband were a licensed contractor, he might have filed a "mechanic's lien" on the property that could be executed upon the successful (eventual) sale of the house, but that does not appear to be a practical option here.
Your earnest money deposit (potentially), legal fees, the inspection fees, any appraisal fee you may have paid, and other costs you incurred in trying to salvage this transaction are gone. That is the nature of the risky short sale purchase. I am sorry you could not complete the purchase, but it appears to be time to move on to another option. Did you - at least - get a refrigerator out of the deal?