Short sale short changes new homeowner

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by Gary Harper

Bio | Email | Follow: @GaryHarper3TV

azfamily.com

Posted on February 22, 2013 at 6:40 PM

Updated Friday, Feb 22 at 4:23 PM

PEORIA, Ariz. -- A new Peoria homeowner is upset with the bank that short sold her the house.

This has to do with $7,000.

That money, the homeowner claims, was supposed to be used to fix the roof before she moved in.

Instead, she said the bank pocketed the money.

Elizabeth Bathory is proud of her Peoria fixer-upper that she recently purchased through a short sale.

"In a short sale, you're never very sure what you're gonna get as far what the condition of the property is in," Bathory said.

But before purchasing the home Bathory said she did have concerns about one issue, and that was the roof.

"We found out that there was some problem areas on the roof. There was hail damage," Bathory said.

So Bathory said she made a request for the roof to get fixed before she took ownership.

"Since the homeowner was still here in the property, we asked him to make a claim to the bank on our behalf," Bathory said.

That claim was approved and the insurance company issued nearly $7,000 to Bank of America, which was the lender short selling the house.

That money, of course, was supposed be used to repair the roof, but those repairs were never made.

"I was told that because I'm the new homeowner, and the previous owner is no longer there, I'm not entitled to any of this insurance money," Bathory said.

That's right, because Bathory purchased the home as a short sale, she wouldn't be getting that money or the roof repair.

So, she contacted 3 On Your Side.

"I find that it's a misuse of funds because that money was delivered from an insurance company to the bank for the purpose of repairing a roof," Bathory said.

3 On Your Side got a hold of Bank of America, which sent us this written statement saying:

"The property was sold in 'as is' condition and any repairs that need to be made to a property should be clearly documented and negotiated during the short sale transaction."
   
They also told us that the insurance money was used to compensate them for some of  the home's delinquency.
   
Bathory said she doesn't think it's fair and doesn't appreciate the bank's last minute money grab.

"It just didn't sit right at all, I just felt that it's a misuse of funds," Bathory said.

Remember, most foreclosures or short sales are always "as is," so be extra careful when getting involved with those purchases.

 

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