I have a deal in escrow, that is being held up due to outside circumstances (long story).

We are on our second extension, and hoping for the circumstances to finally get resolved, but of course, are worried about losing the home sale.

I was told by one source, that once the seller bank begins the foreclosure process, they have to file an NOD (notice of default), and that period takes 90 days. I was told that in that period, the window is still open, for the bank to accept our offer, if we can get the escrow completed.

Is this true?

I'm always confused on what escrow means with you California people, but here in Colorado I made an offer and closed on a short sale listing that was listed and closed after the NOD was filed and the before foreclosure date.

Escrow here means an offer has been accepted and the earnest money deposit has been given to the escrow company. In CO, the title company is also the escrow company, but here the escrow company handles all closing details. The title company just issues the insurance policy.

As for the original question, it's amazing to me that an agent is involved in short sales and doesn't understand the foreclosure process. Google is your friend.

The lender can approve or deny a short sale whenever they want, regardless of the foreclosure status (prior to the trustee's sale).

We just never call it in escrow here, but it sounds like it is the same thing.

Thanks BK Estates. The reason for my asking is because I've heard many conflicting responses on this issue.

I've been told by a very well experienced broker (who deals specifically with condo foreclosures), who says that once the foreclosure process begins, that process cannot be interrupted.

But I have heard a few others who said what you just stated, that there is definitely a window, if the seller bank is willing to consider and close.

Contrary to what most people think, the lender really doesn't want to foreclose if a SS will work.
I've heard of sheriff auctions sales being cancelled the day of the sale by the bank.
Once it goes through the sheriff sale, it's not easy to undo but it has been done.

The question has been answered, but I will reiterate. The bank can accept the short sale up to the moment they actually transfer title to themselves in a foreclosure.

A good foreclosure attorney is a big help :)