Short sale and automatic f/c stay with Chapter 13

[Steve1956]

A trustee sale date is in place. November 3, 2009

California property.

A complete (by the lender's specifications) short sale package submitted to the lender on October 19th. The buyer is financially strong, conventional 20% deal, paying slightly above appraised market value of property. This is a deal that makes sense all day long.

The challenge is that the lender, IndyMac has a strict policy about their review times of short sale packages and the procession to the sale date keeps moving. They may or may not review the short sale package in time to delay the sale, even if the short sale package makes sense and is to their benefit.

The question: If the borrower's attorney files a Chapter 13 and is granted the automatic stay, can the BK trustee, (or whomever) ORDER that IndyMac review the short sale package, and report to the court with their decision to accept the short sale offer or not, BEFORE granting a relief of stay to the lender?

[UpsideDownMI]

This would not work if the borrower filed as the property in question would legally own the property. Also, why would a credible buyer file just to be able to buy a house on a short sale? There are other issues involved, such as how would the borrower obtain financing after filing. It may be possible for this to go through if the seller filed, but the best bet is to get the lender to agree to delay the trustee sale.

[Steve1956]

The buyer is not the one to file bankruptcy. I am referring to the SELLER filing BK so give the lender adequate time to review the short sale offers rather than to sell the property at auction.

[UpsideDownMI]

Sorry for misinterpreting your post. It is possible, but unlikely. The biggest issue that I see is, what is in it for the seller. If the seller files bk there is no longer a need to sell as the property could simply be "surrendered" by the seller with the same impact of a short sale. Surrendering would also be less stressful and time consuming for the seller.