 Sam
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 Posted: Thu Apr 08, 2004 3:09 am Post subject: Canceling the contract due to delay in mortgage commitment |
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In many contracts related to mortgage, the buyer is given a certain amount of time within which he can obtain the commitment for financing the purchase of a home. In case the buyer fails to obtain the commitment within the specified time period, he should send a notice to the seller within the date provided in the contract. But if the buyer does not notify the seller within the time period, he loses his right to terminate the contract.
Under this situation, if the buyer fails to attend the mortgage closing, then he may lose the money he has given as the down payment on the purchase price of the property or even more depending on the financial loss incurred by the seller.
In case your seller's agent cannot appoint an appraiser, then as a buyer, you will have the right to sue the agent or even the seller, for bad faith in abiding by the terms stated in the contract. But if the delay has been due to the appraiser or any scheduling problem, then you can request for an extension of the period within which you will be getting the loan amount.
If you get the mortgage commitment after the date provided in the contract for the financing contingency and after that, you ask for a termination of the contract, then you will not be able to do so. This is because the commitment did not occur within the time set forth in the contract. If the lender refuses to finance your home purchase, then you should consult a real estate attorney to find if you will come across any sort of inconvenience due to the delay caused by the seller or his agent.
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