Home Sold Twice to Two Different Buyers

Douglas Garhartt and Brandon Lively would like to finish laying down new carpet in the four-story ocean-view townhouse they purchased as a short sale in March, as well as re-do the kitchen and the master bath, but they are afraid it could be money down the drain." We had to stop because we don't know if it is our house or not," says Garhartt, who has a deed to the property. But an investment group also has a deed to the property. It turns out OneWest Bank sold the home to both parties days apart, cashing both of their checks.

Garhartt and Lively purchased the three-bedroom condo in San Clemente, Calif., on March 11 as a short sale for $365,000 -- far less than the $712,552 the seller owed on the loan -- and moved in. Then on March 15, Saint John Trust purchased the same property at auction for $346,896 and immediately sent Garhartt and Lively an eviction notice. (Notice how the two amounts totaled nearly equal the amount of the seller's mortgage.)

So who is going to get the home?
Attorneys for the parties have been in and out of court on the matter several times, and are due back again on Oct. 8 and Oct. 20, Garhartt told Housing Watch. "We haven't even had a housewarming party." He hopes the parties will be able to reach a settlement agreement in which investment group Saint John Trust would back out and OneWest, formerly IndyMac, would refund the investment group its money.

"Basically the bank just has to give them back their money and acknowledge that we have the original title," says Garhartt, a film producer, florist and artist who has had his work featured on HGTV.

Scott Haushalter, a real estate broker and a principal for the investment group, told Housing Watch in a brief phone conversation that he is not sure when the next court date is scheduled, or what's going to happen. Although he agreed he'd discuss the matter in more detail after a meeting that he said he was entering, he did not respond to HousingWatch's attempts to reconnect with him after that meeting.

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However, Haushalter did tell The Orange County Register: "We don't have a house or our money. At least they have the house that they bought."

Garhartt says that OneWest does not want to acknowledge the purchase that he and his partner, Lively, closed on. He says that OneWest has issued a cashier's check in the amount of Garhartt and Lively's payment to the title company, saying that the escrow company (Point Break Escrow, which was used for both sales), closed with Garhartt and Lively by mistake.

The bank told them that it did not receive all the required paperwork before the closing, while Garhartt says all documents were sent. His partner, Lively, works for US West, the private title company owned by Bank of America.

"We met every single requirement," says Garhartt. "We did because they ultimately approved us for the short sale and cashed our check. They are really trying to stall the process."

"Of course in the market with short sales and foreclosure everything is down to the wire," says Keller Williams agent Aimee Bevi, the real estate agent who sold the home to Garhartt and Lively. "Wires do get crossed, but typically it's a fast fix that happens."

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