dealing with a bankrupt seller

[dorodoro]

What is the name of your state?nevada
I presented an offer on a condo, put down $2,000.00 earnest $, paid for inspection, appraisal and found out from a prelim title report that the seller filed for bankruptcy last Dec. I offered 100,000.00 to purchase,
the seller owes about $82,000.00 as of March 2002.
Title company is dealing with the lawyers and telling me that I should wait for the court order and than everything is going to be fine and the escrow wil close. I do not know what stage of the bankruptcy proceedings the sellers are in.
I am confused and the real estate broker is advising to move away from this deal because "it might not close at all." I am going to lose about $700.00 (inspection, appraisal) not to mention earnest money if the title company does not release it. what should I do?
what does it mean that a "bankruptcy has/has not been
discharged"?

 

[MortgageGuru]

Unless time is an issue here then you are better off waiting. It shouldn't take long to get the permission to sell a house while in BK. If you have to find something else though you may want to negotiate with the seller and get them to buy the appraisal and home inspection from you in order to recoup some of your money.

 

[nextwife]

I presented an offer on a condo...and found out from a prelim title report that the seller filed for bankruptcy last Dec. ... I do not know what stage of the bankruptcy proceedings the sellers are in.
I am confused and the real estate broker is advising to move away from this deal because "it might not close at all."

Depends also on the condition of title. Odds are, he has judgements, liens filed against him. The BK must be completed BEFORE these can be discharged in the BK. If the combined total of all debts that must be paid at closing exceed what the seller is getting in sales price, plus closing costs the seller is obligated to pay, it cannot close.

I was once involved in a transaction that took a year to close because there was so much filed against the seller/ property (way above the value) that the buyers waited out the full BK process.

what does it mean that a "bankruptcy has/has not been
discharged"?

If the bankrupcy has not been completed, the debts in the list of creditors are still OPEN and anything of record against the property is still a valid lien. Once the BK is complete, all dischargable debts will be eliminated.