[WSBARP] Bankruptcy and Real Estate Question

[Scott Hildebrand]

A client of mine who had entered into a purchase and sale agreement a month
ago, waived inspection contingency and released $5,000 earnest money signed
closing papers today. The Seller was to have signed yesterday. Upon
returning to his office, he received a message from an attorney that the
Seller had filed bankruptcy and that the sale was off. Apparently the Seller
is in pre-foreclosure but that fact was not known until very recently (like
the last couple of days).

 

I know that bankruptcy can stop a sale at auction (as a result of
foreclosure) but can banko stop a legitimate and voluntary sale?

 

I would appreciate it if any of you crossover practitioners could help me
out on this one.

 

Thanks in advance.

 

Best,

Scott Hildebrand

Attorney at Law

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