Posted by Rich-CA on August 29, 2007 at 21:07:55:
Did your contingency state the max interest rate? Some do and others don’t.
Anyway, if a lender turns you down, get the letter from them (they have to provide one) to satisfy the contingency. If you require Alt-A to get a loan, you should have no problem getting turned down.
You do file income taxes, right? You could go to full doc using your tax returns to show income.
suit for specific performance - Posted by Helene
Posted by Helene on August 29, 2007 at 17:36:27:
Have many postings regarding this on the main news group.
Entered contract 20 months ago for condo in Costal Carolina. Loan contingency says I must make every effort to obtain a loan. I put down that I would obtain financing up to 95%. I have funds through HELOC’s to put more down, but don’t want to. I’m stated income due to self employment. Great credit. Alt A market is gone.
Told the builder this and want my money back. They responded with an attorney letter saying I had 10 days to provide proof that I had been denied. Then they want to get me qualified.
I contacted an attorney whom my father is doing some remodeling for. Apparently some hot shot. He was impressed with the builders law firm. He also said he would be too expensive and referred me to a former colleague whom had worked at his firm before striking out on his own. Translation, to me, is he’s not comfortable with RE contracts.
Called atty 2 late this afternoon. He also seemed pretty impressed with the law firm, and the builder. Said they had deep pockets, and probably (without having read the contract) had a pretty tight contract.
He also said that they could come after me for damages, ie. for the difference for what they eventually sell the place for.
Oops: I just read the note above asking to keep it short. I’ll summarize.
I told # 2 to hold the phone and not do any work yet. I’m not comfortable with him.
At this point, I don’t so much care about the deposit as I don’t want to be sued for specific performance.
These builders are in a world of hurt and taking prisoners.
This is the south, and I’m not southern. Apparently this builder is a fixture in the community. Should I get legal council from another town?
How much is involved? - Posted by John Merchant
Posted by John Merchant on August 30, 2007 at 17:57:54:
If you just sent the builder a relatively small amount of earnest money, since you sent it to the Seller directly* then it might be cheaper for you to just tell him to take a hike and you do the same.
FYI, buyers are rarely sued for Spec.Perf. as it’s normally easier and cheaper for the S to just find another buyer. Lots of threats by sellers like the one here, but normally their lawyers have more sense and don’t sue defaulting buyers.
It’s normally the B who’s suing the S for SP and that’s a whole 'nother story…since every parcel of RE on this earth is unique unto itself and there ain’t another just like it, many, many court decisions in favor of the B making the S produce the deed as promised.
Betcha you’re not going to be sending any more EM to any out of state builders, right?
*Big no-no…should never give EM to S but only to an escrow co or firm, with carefully written contract giving it back to you if/when it falls through.