Home Buying in Irvine>Question Details

Angela, Home Buyer in California

Can I still back out from a purchase agreement once you sign the contract?

Asked by Angela, California Fri Mar 7, 2008

I recently signed a contract for a home located in Irvine california one week ago. But my builder is using the incentive to force me into their lender. If I back out now, will I get my full deposit back? The house is closing less than 1 month

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9
Angela,

You might want to have a real estate attorney look your contract over, if you don't have an agent representing you. Your contract is just that, YOUR contract and without any of us being able to read it, we really can't answer that question with 100% certainty. If you need a direction to go for finding a very capable attorney (who can look it over for a small fee), please let me know.

Best of luck,

Robert M. van der Goes
(714) 305-2050
2 votes Thank Flag Link Sun Mar 9, 2008
Angela,

Look at your Purchase Agreement (contract) as see what it says about using the builder's lender. If the "incentive" was conditioned on that, you must use that lender to get the incentives. If you want to terminate the contract, both parties must agree and both parties must agree to the dispositon of the "deposit". If it is a large deposit and the builder was to keep it, you may have to talk to a lawyer.
2 votes Thank Flag Link Fri Mar 7, 2008
If you can't get financing, the deal is null and void and you will get your money back. There are lots of ways to torpedo the financing. For example, you can tell the lender that you're unemployed and have no source of income. I'm sure you get my drift.

You can also tell the builder that they cancel or you will make their life a living hell. You will not sign off on the house until every scratch is fixed and the house is 100% perfect. Since no house is perfect, they can't possibly get your satisfaction.

Don't let some scumbag realtor try to convince you that you can't get out. They all say that because they want their commission dollars.
1 vote Thank Flag Link Sun Mar 9, 2008
Based on the CA-RPA (California Residential Purchase Agreement), which all buyers use when submitting an offer, the buyer has rights to review aspects of the home, as well as financing, appraisal of the home, and other items that are significant to the home purchase.

As a trusted Realtor, our duty to our principals is to ensure that they are educated in the residential purchase process. A good real estate agent will take you through each item so that you understand the consequences of each clause in the contract so that there are no surprises as you move forward.

In your case, a builder cannot force you to use a certain lender, unless that was mutually agreed upon in your contract. Buyers retain the right to the return of the earnest money deposit should they wish to exercise cancellation of the agreement.

If you have any questions on this or any other real estate related matters, I specialize in homebuyers in Irvine, so I am always happy to help!

Good Luck!

Joshua Sun Hong
First Team Real Estate
(714) 944-6912
Web Reference: http://irvinejoshua.com
0 votes Thank Flag Link Wed Mar 26, 2014
He can not force you to use his lender. He may offer incentives but you can always turn them down. As long as you have the money on the contract closing date - he can not do anything except talk. He can ask you to apply with his lender so he has a back up solution but nothing makes you accept that loan.
0 votes Thank Flag Link Mon Mar 24, 2014
The typical purchase contract when you are purchasing will lead to a contigency upon financing capability. At least in Arizona. You have the right to choose your finanacing vehicle based on rate etc. If the lender is unable to satisfy your budget, rate and capability to finance within your means you qualify for this contigency. Contact a local realtor or a lawyer and as stated read the fine lines of the contract you signed.
0 votes Thank Flag Link Fri Mar 7, 2008
Did you have a Realtor representing you? If so, talk to him/her and they will be able to advise you.
Web Reference: http://www.DotChance.com
0 votes Thank Flag Link Fri Mar 7, 2008
This will depend upon the specific terms of that specific contract.
0 votes Thank Flag Link Fri Mar 7, 2008
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
You should read your contract carefully. There may be some ways you can back out of the transaction without loosing your deposit. You can always tell the builder you would like to back out and want your money back, and see what his answer is. If the contract was based on your quailfication for the loan, then maybe you just don't qualify now? There are numerous ways to back out of a contract before you own the home, but you need to read the fine print. If your working with an agent, then speak with them. If you need additional assistance you can email or call me anytime.

Joe Homs
949-625-4533
joe@joehoms.com
Web Reference: http://www.joehoms.com
0 votes Thank Flag Link Fri Mar 7, 2008
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