Bank Foreclosure Sale Contracts Are Unethical
by Joe Trometer
Bank Owned Homes
I wrote an offer on a Bank Foreclosure...
The Bank countered my offer...
I accepted the countered offer...
The Bank reneges on the contract.
Definition of renege: To go back on a promise or commitment
These are contracts!
One hour after I accepted the Bank's counter offer, my Broker calls me back and says, "The Bank just received another offer and wants an addendum for highest and best offer for multiple offers".
In my opinion, Bank foreclosures are unethical in honoring written contracts. I accepted the Bank's counter offer contract...
... I feel the contract should be honored!
My Broker says, "There is no rhyme or reason for what the Banks are doing with their contract offers!"
Banks get away with what ever they want with a contract... Honor them or not without recourse.
Why bother writing contracts?
"Breach of contract", is what I say. It is corrupt to submit a contract that is not binding, verbal or written!
A "Letter of Intent" is an inquiry without commitment to see if a contract is in order to pursue.
Specific Performance of Contract...
There were ethics in contract law to honor contracts or suffer the consequences when the terms of the contract are not met.
With Foreclosed Homes, for some reason Banks are NOT,
honoring written contracts,
following contract ethics,
and ignore the set of principles of a system of moral standards for writing contracts.
What Can I Do About This?
It would be a waste of time and money to try to go to Court for specific performance of a contract with a Bank on a foreclosed home.
It would cost more than the foreclosed home is worth in Court costs to try to sue a bank for breach of contract.
This Is Not The First Time
In the last five years of making offers on foreclosed homes, Banks are doing whatever they want!
I had an accepted offer at two-thousand dollars over asking price and two days later the Bank cancelled my contract and accepted a different offer. Is that fair? Absolutely not!
It's A Numbers Game
I continue to make offers...
"I win some, lose some, and the goal is to win more than I lose!"
I keep to my standards of not falling in love with a property!
I set my limit of what I'm willing to pay and never exceed my limit.
When Banks do not follow standard ethics for contracts, I withdraw my offer and move on to the next.
It's a shame that we Taxpayers have to pay to support unethical Bank proceedings, but that's not going to ever change!
I Stay Positive
Real estate investing is full of Trickery.
Strategy is our best offense and defense to work within the system we have. Find those strategies here on Ask-The-Rehabber.com.
The way I do my home remodeling is to buy an investment house to stay in the game of rehabbing houses, so...
When in doubt, keep making offers!
P.S. If this has happened to you, we would love to here about it. Click the link below to add your comments.