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I'm in escrow on a REO in Hawaii. This house foreclosed and…

I'm in escrow on...

I'm in escrow on a REO in Hawaii. This house foreclosed and was bought by Mellon Bank of NY who is now selling it to me. There are liens on the property that they have known of since 2/17, but have not cleared them and appear to not be working to clear them. I signed the contract in good faith and am ready to close except my lender won't give me a loan without a clear Title. My loan lock is expiring and I will be charged a fee to extend. I have spent about 10K in inspections and trips out to the property. What is my recourse? Why in the world would the bank not want to or not work towards selling the house? Thanks

Lawyer's Assistant: Because real estate law varies from place to place, can you tell me what state this is in?

Hawaii

Lawyer's Assistant: Has any paperwork been filed?

What kind of paperwork? I'm in escrow. I have a contract.

Lawyer's Assistant: Anything else you want the lawyer to know before I connect you?

I feel that the bank for whatever reason entered into a contract with me without preparing the property for sale and making no efforts to do so. This is the second time I am in escrow on the same property as the original purchase price was found to be too high for it's condition. I let the property go and rebid when it came back on. In the first escrow and when they took possession back in February they knew the title was dirty, but never made efforts to clean it. They put the house back on the market with this knowledge. I signed in good faith to purchase and am out demonstrable money. I feel they didn't and have been toying with me. For what reason? I have no idea. Thanks

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Answered in 6 minutes by:
12/5/2017
WiseOwl58
WiseOwl58, Lawyer
Category: Real Estate Law
Satisfied Customers: 4,595
Experience: Experienced real estate lawyer and real estate broker.
Verified

Since the bank entered into the contract with you, they will have to fulfill the conditions of the contract to get the house ready for sale to you, including clearing the existing liens.

If the bank does not do that, then they are liable to you for damages, which would include all the money you spent so far on inspections, etc. and the loan extension fee, if you pay it. They may be liable too if you end up buying a comparable house for more money, then they owe you for the difference in price.

I would tell the bank they must comply and complete the sale. Or else, tell them you have conferred with a real estate lawyer and you will bring a lawsuit for damages if they breach the sales contract and do not complete the sale in good faith.

Please rate 5 stars ***** and hit send to close out the question.

A bonus is appreciated after you rate.

Good luck to you. I wish you all the best.

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Customer reply replied 8 months ago
Thank you for the advice. I made the mistake of using the Sellers agent as my Buyer’s agent as he had been my agent when he took the listing.
I just reread the addendum to the contract that came from the Seller that basically lists severe penalties for any transgressions of the Buyer, but the Seller is held harmless.
I will highly rate you. Thanks again, Kerry
thank you please rate Five Stars to close out the question
WiseOwl58
WiseOwl58, Lawyer
Category: Real Estate Law
Satisfied Customers: 4,595
Experience: Experienced real estate lawyer and real estate broker.
Verified
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