Foreclosure Real Estate Transactions
What Are Some Things That Can Happen To Cause A Purchase To Fail Or To Fall Through?
People sometimes get “buyer’s remorse” where they don’t really have a reason to walk away from the deal but may regret the purchase. Buyer’s remorse is also common for people who find a better deal. If they are halfway through a deal and they come across a better deal, you will see people saying, “Well, how do I get out of this contract?” Well, you can walk away but you might lose your earnest money, you might be liable for commissions to the agents etc. But that’s definitely one way.
With seller’s remorse, it’s the same concept but just the opposite way. The seller gets into it and says, “I’m not going to sell to you anymore. I don’t care what you do. I’m not coming into closing because I’m going to keep the property” and the same thing happens.
The buyer could sue them and even force them to sell them the property. The agents could sue them and say, “You owe me my commission. There is no reason that this transaction didn’t go through but for you breaching the contract”.
Problems can also arise with properties. For example, if there is water leakage. Attorney Brian Douglas had a case where a pipe broke under the foundation of a home. The house had hardwood floors and didn’t have a basement. It was just on a concrete slab but all the water pipes ran through that concrete. So when the pipe broke, it ruined the floors. They had to dig a hole in the concrete in the kitchen and fix the pipe with a concrete bag. In such cases, the parties fight over who is going to pay for the replacement of the floors. The seller may not want to pay for it even though the contract says the seller had to, etc.
Anything can happen to a property in the middle of a deal, which could cause the parties, one party or the other, to stop and say, “No, I can’t go forward.” Depending on what the contract says, you may not have a right to stop, you may still have to go forward and either fix it or risk being held liable to all the other parties.
Once you go under contract, you’re bound by the terms of that agreement. However, you do have due diligence time and can do contingencies like a financing contingency, for example.
What Is The Foreclosure Timeline Or Process? When Does That Come Into Play?
Every state handles foreclosure differently. In Georgia, foreclosure is generally done through a non-judicial process, meaning that a statutory procedure has to be followed. They can do a judicial process where they would actually file a lawsuit in foreclosure suing you. The bank would sue the homeowner, and they would serve you with a lawsuit and you’d get an attorney. Your owner will go to court and the judge would enter an order saying, “Property is foreclosed on …”
Most lenders in the State of Georgia do the non-judicial route because it’s cheaper, faster and easier for.
In the non-judicial process, if you don’t make your payments for 90 days, they are going to do what’s called ‘accelerating a debt.’
What happens then is if you owe $100,000 in balance, instead of saying you owe $5,000 for the past due payments, they are going to say, “Okay, we told you to pay $5,000 and get caught up but you ignored us. Now you owe us $100,000, which is the whole balance due. You have 30 days to pay that or we are going to begin foreclosure.” If you don’t pay the $5,000, you probably can’t pay the $100,000 and they know you’re not going to pay that.
What happens then is with the non-judicial foreclosure process. They advertise in the official county newspaper for four consecutive weeks that the property is going to be sold at public auction on the courthouse steps and it will be the first Tuesday of the following month. It starts at 90 days and after that, it’s just up to the lender how fast they want to go.
Commercial property is a little bit different and the rules are not nearly as friendly. The rules aren’t quite the same and you’ve got to be very careful with that because the statutory process is designed to protect homeowners. It does not work in a way to have people just wake up and have their stuff out on the street. They give people an opportunity to work through it and get it figured out.
There could be a number of reasons why a Real Estate Transaction Fails To Go Through. Get information about Foreclosures, or call the law office of Attorney Brian Douglas for an initial consultation at (770) 933-9009 and get the information and legal answers you’re seeking.