RE/MAX Mid-Peninsula

Initial Business Response /* (1000, 5, 2014/11/03) */
I am in receipt of the complaint your office received regarding the sale transaction on a property which an agent in my office was representing the Seller in the transaction
I, along with another Investor purchased the 2nd loan from a
private party in When we purchased the 2nd loan, we were informed that there was a balloon payment that was delinquent and repayment of the note was past dueWe purchased this note sometime prior to the owner listing the property for sale
Through the proper channels, Golden West Foreclosure Service filed a Notice of Default and Notice of Balloon Payment due to the owner of the propertyOnce the Notice of Default was filed, the owner of the property then decided to sell the propertyThe owner hired a real estate agent in my office to represent her in the saleThe owner of the property tried many stall tactics to prevent the property from being sold at a Trustee's SaleThe owner filed bankruptcy in the San Francisco Federal Bankruptcy Court, which automatically postponed the sale date of the propertyThroughout the process and numerous postponements of the Trustee's Sale, the owner did not follow a repayment plan that all parties agreed to, therefore, the Bankruptcy Judge allowed the foreclosure to continue, and the bankruptcy was dismissed by the courtThe delays in closing the transaction had everything to do with it being tied up with the bankruptcy court
I am sorry that the Buyer was not able to purchase the propertyShe did contact me at my office and was already hurling accusations that something seemed "fishy" therefore my answer to her was that the property is not for sale
I find it very interesting that the Consumer's Desired Resolution is "for the initial Seller to receive her home back that was unethically taken from her and the financial hit she incurred." All legal steps were taken in order for me and the Investor to protect our financial position, as being the 2nd note holder
An agent in my office had a working relationship with the owner prior to when 2nd note was purchasedI had no involvement with the transaction on the sale of the property
Please note that all Trustee's Sale must be properly noticed and posted prior to the property going up for auctionAnyone interested in the property had a right to bid on the second loan at the time of auctionI had no way of controlling who attends the auction and that there were no additional biddersI was there to protect my financial interest
Initial Consumer Rebuttal /* (3000, 7, 2014/11/07) */
(The consumer indicated he/she DID NOT accept the response from the business.)
It is interesting that the response from the broker is "I was there to protect my financial interest." It was very clear the he was protecting his financial interest over the client he / his office was representing in the sale of the property
We had spoken to the agent in his office regarding the auction notice, and were told very clearly the house was not at risk of being in auction, the seller had gotten out of itWe were told the sale is in process and we shouldn't have any concerns even thought the seller was going through severe financial hardship
The reason for the closing to be continuously delayed seems to have different storiesIn the broker's response, he is saying the reason was due to bankruptcy courts and his agent told us it was because the lawyers were negotiating with the tenants to leave the home prior to the leaseWhich of the stories is true? In either case the delay of closing on the house does not have a clear answer, and had the house closed when initially planned, the seller would not have lost her home
At this point, it seems that the broker took advantage of an unfortunate situation, and likely had more information on the property given the agent representing the sale worked for himThe full transparency of the information he detailed above was not shared even when we asked his agentWe also learned the bank took the home on the day of the auction, and had no prior notice of this - again even after we had inquired
The protection of his financial interest and his office also representing the seller seems to be a clear conflict of interest
The only reason I am reporting this is because I have been a witness to the swirly communication throughout this transaction, and did not understand what was happening during the process until I learned of the outcome with the houseI would never trust working with this office or recommend anyone I know since clearly the intent is to put one's own personal interest over the clients they representIn my view, this is highly unethical
Final Business Response /* (4000, 9, 2014/11/18) */
The Notice of Default for the 2nd loan on *** *** Avenue, *** City was filed on 10/11/There terms of the note had been modified from the original terms so the original promissory note and modification agreement (which included an extension of the loan terms and reduction in interest rate) would not be due and payable until October 1, At the time of filing, the Seller was in arrears over $61,A Balloon Payment Notice was sent to the Seller via certified and regular mail that the note was due and payable on 1/10/or the note holder would take the necessary steps to foreclose on the propertyThe Notice of Trustee Sale for non-payment of the note was filed on 1/14/2014, with a scheduled sale date of 2/06/The purchase contract between the Buyer and the Seller was not ratified until 8/19/The foreclosure process had started months before the offer was accepted by the SellerThe Buyer was notified of the pending foreclosure via the Preliminary Title Report provided by Chicago Title Company when the offer was accepted by the Seller*** *** *** who is an agent with RE/MAX Mid-Peninsula was representing the Seller exclusively and *** *** an agent with Hun Realty, was representing the Buyer exclusively
The terms in the offer that was accepted by the Seller required the property to be vacant at the close of escrowThe problem was that the Seller had entered into a rental agreement with the current tenant and still had over years remaining on the leaseThe Seller and Seller's legal counsel were attempting to negotiate a move out with the tenant and was simultaneously trying to postpone the foreclosure of the homeIn an attempt to prolong the foreclosure, the Seller filed for bankruptcy protection not once, but twiceThe Bankruptcy court ruled that the foreclosure would be allowed to continue and the property was foreclosed on 9/12/That was months from the initial filing back on 10/11/and before the Seller was not able to negotiate a move out with the tenant and therefore unable to complete the sale of the property
J*** Investment Incwas a minority investor along with a majority investor, Working Dirt RLLC when this note was purchasedAt any time the seller had the opportunity to sell the property with the tenants in place, pay off the 2nd loan or adhere to a payment plan that was outlined by the Bankruptcy court and would have been able to stop the foreclosureI am sorry that the Seller was unable to complete the sale with the Buyer, but at no time did I interfere with the seller's ability to sell her property
The Buyer subsequently called me asking if I would sell her the propertyThen and only after I informed the buyer that the property was not for sale at the price she was prepared to pay is when I received this Notice of Complaint from the Revdex.com, Inc
Prior to the foreclosure, I had never spoken with the buyer so I can't comment on the actions of others including the communication between the Seller and her agent, Karen Zombulovich (Kovacs)
I am prepared to provide copies of the purchase contract, Notice of Default, Notice of Trustee's sale, bankruptcy documents and loan modification at your request to confirm the information above
I understand the Buyer's frustration in this most uncomfortable situation, however there was nothing unethical with the way the foreclosure was handledThe Seller did not pay her mortgage and the home was foreclosed on, as it would have been with any conventional lenderDue to the foreclosure, the Seller was not able to complete the sale, and the Buyer was not able to purchase the property at the price in which she wantedThat is all that happened