foreclosure stopped, now short sale....realtor ethics?

[Mike Landry]

Here is the deal.  I was the winning bidder at the February foreclosure auction.  As I went to pay the trustee, a relator approached me and advised me that it is his clients house and that the client filed bankruptcy the day before.  They put up a short sale listing about 4 days prior to the auction.  I paid the trustee and the next day the official word was received, foreclosure stopped, and they are mailing my money back. 

The realtor was knowledgeable and knew he couldn't interfere with the foreclosure process.  I casually laughed and asked him how much a bankruptcy filing costs and he didn't hesitate....$4,000.  Then he said once the foreclosure is reversed they are going to drop the bankruptcy and continue trying to short sale the house. 

Does this seem odd and a bit unethical of the realtor to anyone else?  The client paid $4000 to stop a foreclosure but is now going to have a short sale on their record anyways and still have to move out..... just so the realtor could get their commission? 

I did put an offer in with them for a short sale but I am questioning this transaction.  Any thoughts.

[Wayne Brooks]

@Erez Jonathan@Ron S. @Dion DePaoli? I don't know about the left coast, and other areas, but the lost note defense seemed to have legs here for about 10 minutes, and only in the minds of some foreclosure defense attorneys. A great percentage of the Foreclosures here, all are judicial in front of a judge, do not have the original note, and proceed with a lost note affidavit without a hitch, whether or not the defendant has an experienced attorney.  My understanding is there typically is at least a copy of the executed note.  I have no idea what happens when that copy doesn't exist.