One of my clients called me today to inquire about a new listing that just popped up on the market in Carmichael. When I pulled up the data on MLS, I was a bit alarmed at what I found.
In the "Agent Only" remarks section, there was a note that read "Closing is subject to seller obtaining title." Huh? There was an attachment to the listing that then explained that the "seller" is a for-profit corporation that the actual owner has given a power of attorney to sell the house. It is listed as a short sale and subject to the bank's approval of the owner's short sale to the seller...the seller then is selling for a profit via a simultaneous escrow. The house is listed by a small, Sacramento area independent brokerage that I have never heard of.
My thought is that this sort of transaction walks a very fine line - both legally and ethically. There was legislation passed several years ago called "The Home Equity Sales Act" that protects distressed sellers. Click here to read about the Home Equity Sales Act.
All I can say is that I will not touch a transaction like with with a 10-foot pole! Luckily my client thought that was a good idea too.
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