Real Estate Investor Sues Lender For Dragging Feet In Failed Short Sale

In San Diego County, California, North County Times reports:

• A North County real estate company has sued a lender for a failed short sale, a transaction that has become increasingly popular while home prices tumble. [...] The buyer in the stalled short sale, Ribsy Productions, a real estate company based in Solana Beach, filed suit on Friday against Aurora Loan Services, a Littleton, Colo., mortgage lender, for not following through on a short sale. The lawsuit seeks suspension of any foreclosure proceedings on the Arizona property and other reparations.

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• The Solana Beach company is suing Aurora for breaking a contract and several other charges after the lender did not respond to requests from the buyer, Ribsy Productions, for an approval letter. "We don't have to prove intent. They have responsibilities on the contract, and they didn't follow through on those obligations," said Ajay Gupta, the lawyer representing Ribsy Productions. "This is a straight breach-of-contract case." [...] Aurora holds a $587,000 loan on the Tucson, Ariz., home and accepted the short sale offer of $158,000, a 73 percent drop in value, according to the lawsuit.

For more, see Buyer sues lender over short sale (In an apparent first, a lawsuit comes from the frustrating type of purchase).