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Daniel Keith, Renter in Albany, NY

How long does it take to get out of a contract if you could not get mortgage commitment?

Asked by Daniel Keith, Albany, NY Fri Mar 22, 2013

We had mortgage commitment with a contingency that the neighbor sign a driveway easement letter (stating that he was responsible for his property and we were responsible for ours). Long story short, the neighbor was an older gentleman stuck in his ways and he refused to sign this letter for our bank (even after the sellers offered to pay for his attorney). We were denied a mortgage because we could not get this letter signed. My question is, how long does it take to officially get out of contract after my bank sent the denial letter. My husband and I are in a hurry to move to a specific city for his job. We are aggravated that we need to start all over with another house but there are no other options but to buy a different home without a driveway easement. We are going out today to look at a few houses, can we put an offer in on another house even though we are technically still under contract with a house we no chance of owning? I can not express enough that we are in a hurry.

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If your purchase agreement was subject to a mortgage commitment, then you can be released right away. You will need to provide a written letter to the seller or the seller's agent stating that you are cancelling the contract and the reasons why (refusal to sign a driveway easement letter). You could give the seller 24 or 48 hours to resolve the issue if you really want the house. If not then have the date of the letter be the cancellation date. You have a very good case here to be able to get back your earnest money deposit.
0 votes Thank Flag Link Fri Mar 22, 2013
As long as you are within the dates on your agreement you just need to provide a denial letter and you should have your deposit refunded . You should always ask an Attorney legal questions - That is the simple answer though. How your contract is written will determine this.
Good luck !!
1 vote Thank Flag Link Fri Mar 22, 2013
This varies by state. In Massachusetts, you should have your monies returned to you within a reasonable time period as this mortgage denial was no fault of yours. Your real estate agent should be communicating with the listing agent or the lender to get the deposit returned quickly so you can move forward. Best of luck in this stressful situation. Feel free to contact me directly if you have any further questions or concerns. 508-245-9458 or deewebster@csrealtypartners.com
Dee Webster
0 votes Thank Flag Link Fri Mar 22, 2013
You should immediately be able to get out of a contract and receive your deposit back with a letter from your financing institution declining a mortgage. It sometimes takes a few days to get all the releases signed and your check back from the bookkeeper of the listing agency.
0 votes Thank Flag Link Fri Mar 22, 2013
I would assume you have an attorney and should contact him/her. An easement is a tittle issue and that may fall under a clause in most mass purchase contracts allowing the seller more time to correct title. You may want to see if the seller can work it out. Once this I known it could be an issue with other buyers.
0 votes Thank Flag Link Fri Mar 22, 2013
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