Foreclosure Buyers.....Beware of Gazumping

The Ledger defines and details the practice of gazumping, where institutional owners of property continue to take bids on homes after they have accepted an offer.

In foreclosure scenarios, some banks are requiring buyers to sign an addendum that allows the bank to continue accepting offers on a property even after the contract is effective. If the bank gets get a higher offer, the original buyer is cut out of the deal.

It seems, gazumping is a common practice in the UK, and not just on foreclosed homes like here in Florida. With Chinese drywall, mold and unpaid association dues slowing down deals, the last thing we need is for the practice of gazumping to take hold.