What is the name of your state?What is the name of your state? GA
Can a buyer back out of contract and get their money back if they were going to be approved by the lender in a matter of days, just because they decided that this was not the home for them and they had a SIGN that they should not buy this home?
To make a long story short, the loan approval was taking longer than expected all due to their problems, not the lenders, but in any case the lender said they would definately get approval in just days. But the buyer was frustrated and they decided to back out of the loan, their exact words. Sale was set to close 12/10/04. no extension of closing date was made by them or us, does that make them obligated to have closed it by then without this extension??
They want their earnest money back and per their attorney he sites the following case law: Cole v. Cutler, 96 Ga. App 891 (1958): His words are these: GA law states all this is required of the purchaser is a good faith effort to aquire a loan to purchase the property. If after a good faith effort, the buyer does not qualify for the loan, they have the right to rescind the contract and recover their earnest money.
When I read the summary of this decades old ruling, (1958) it says as best as I can determine that if the terms of the loan are vague the contract is not enforceable, so I assume that to mean is also not BINDING?? The attorney also quotes the earnest money paragraph of the GAR form (purchase agreement) that the earnest money is to be returned upon failure to enter into a binding agreement. We were under the assumption we did enter into a binding agreement, when we all agreed to the terms of the contract, signed and dated it, etc. The sales contract was very specific about the terms of their first loan but not specific about the terms of the second loan, the special stips just stated contingent upon buyers ability to get a 2nd loan in the amount of 20% of the purchase price. The first loan was to be an 80% loan, so 100% financing was involved.
The lender did give the buyer a good faith estimate so they knew the specific terms of the loans from the start and agreed to the terms, but it was not detailed in the contract on what the 2nd loan terms would be.
What I do not know is if this case was brought about due to the plaintiffs inability to get a loan based upon the vague terms or does it even matter? In any case where the loan terms are not specific, even if the buyer can indeed get financing, does this make the sales contract non BINDING and non enforceable??
Thanks so much for you thoughts on this matter.
Can a buyer back out of contract and get their money back if they were going to be approved by the lender in a matter of days, just because they decided that this was not the home for them and they had a SIGN that they should not buy this home?
To make a long story short, the loan approval was taking longer than expected all due to their problems, not the lenders, but in any case the lender said they would definately get approval in just days. But the buyer was frustrated and they decided to back out of the loan, their exact words. Sale was set to close 12/10/04. no extension of closing date was made by them or us, does that make them obligated to have closed it by then without this extension??
They want their earnest money back and per their attorney he sites the following case law: Cole v. Cutler, 96 Ga. App 891 (1958): His words are these: GA law states all this is required of the purchaser is a good faith effort to aquire a loan to purchase the property. If after a good faith effort, the buyer does not qualify for the loan, they have the right to rescind the contract and recover their earnest money.
When I read the summary of this decades old ruling, (1958) it says as best as I can determine that if the terms of the loan are vague the contract is not enforceable, so I assume that to mean is also not BINDING?? The attorney also quotes the earnest money paragraph of the GAR form (purchase agreement) that the earnest money is to be returned upon failure to enter into a binding agreement. We were under the assumption we did enter into a binding agreement, when we all agreed to the terms of the contract, signed and dated it, etc. The sales contract was very specific about the terms of their first loan but not specific about the terms of the second loan, the special stips just stated contingent upon buyers ability to get a 2nd loan in the amount of 20% of the purchase price. The first loan was to be an 80% loan, so 100% financing was involved.
The lender did give the buyer a good faith estimate so they knew the specific terms of the loans from the start and agreed to the terms, but it was not detailed in the contract on what the 2nd loan terms would be.
What I do not know is if this case was brought about due to the plaintiffs inability to get a loan based upon the vague terms or does it even matter? In any case where the loan terms are not specific, even if the buyer can indeed get financing, does this make the sales contract non BINDING and non enforceable??
Thanks so much for you thoughts on this matter.