Yes your father can sell the home while it is in foreclosure. Typically once the house is sold at a sheriff sale, you have 6 months to redeem the property or sell it. Remember, depending on your area, you may pay 5%-6% of the purchase price to the agent ($135,000 x 6%= $8,100) If you want to sell the house quickly, I would suggest you contact a real estate agent. If you have a buyer, either contact a real estate lawyer or even a title company. (some title companies will help with for sale by owner transactions.) It will cost alot less.
Just so you know, I am a state licensed appraiser in the State of Mighigan and have 6+ yrs of experience.

