Legal Question in Real Estate Law in California

A musc.-wasting condition forced me to leave my mt. home & live somewhere that was flat so I could walk w/o falling. My house didn't sell when working thru a realtor, so I did the short-sale thing. Each time a buyer made an offer (which was only about $10,000 below asking price), the mortgage co. not only rejected it, but increased the asking price. Eventually, what began as a short-sale, turned into a foreclosure. The mortgage co. finally sold the home for $13,000 LESS than a buyer had offered when the home was still in the short-sale mode. Are there no laws from preventing a mortgage co. from turning a short-sale into a foreclosure? Because this happened, my credit rating really took a hit --- something I never saw coming.


Asked on 11/24/13, 12:27 pm

1 Answer from Attorneys

There are recent laws that preclude foreclosing during a loan modification, but no law requires a lender to approve a short sale or hold off on foreclosing while you try for a short sale. The good news/bad news is that the company that owns the formulas that all three credit agencies use to calculate their scores is on record that their formula hits your credit the same for shirt sales as foreclosures.

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Answered on 11/24/13, 12:37 pm


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