Home Buying in Brooklyn>Question Details

Aleena, Home Buyer in Buffalo, NY

condo buying

Asked by Aleena, Buffalo, NY Tue Dec 2, 2008

My lender(bank) says it can give me commitment letter only after it gets the contract and appraisal of the property, and my lawyer said after signing the contract, I have to put downpayment check in the escrow account. So, I am worried if something goes wrong with mortgage, my check can be lost as the lawyer if there are problems from buyer's side, the downpayment check is confiscated.

I have DU underwriter's findinds page from the bank and a confirmation email that I am approved but no commitment letter? Is it ok?

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Most of what your are asking is legal advice which agents and brokers are not allowed to give.. Your experienced real estate attorney specializing NYC ought to be advising you on this (do not use the seller's attorney). The contract in my personal experience and as others have mentioned can be written contingent on you getting final approval,as you are already pre-approved (which is not the same as pre-qualified) You would usually receive a letter from the lender stating that you have been pre-approved. If your check is put in your attorney's escrow account it should be safe as long as the attorney is legitimate and the purchase is not contingent on anything. What exactly has your lawyer told you?
1 vote Thank Flag Link Wed Dec 3, 2008
I agree with Jenet 100%. You might also consider asking the lender for a "conditional" approval letter that says you currently qualify for the agreed upon sales price subject to appraisal, final underwritting, etc.
0 votes Thank Flag Link Wed Dec 3, 2008
The key to this is whether or not there is a mortgage contingency clause in your contract. If you have a mortgage contingency clause it means that if you cannot get a mortgage, your deposit can be returned. Usually you get a mortgage pre-approval first, then you sign the contract and give your deposit, then you apply for your mortgage which means submitting many documents including the signed contract. Talk to your attorney about having a mortgage contingency clause to protect you. You are right that in these uncertain times with banks changing their standards and so many things fluctuating you want to be protected against losing your deposit should you be denied your mortgage.
0 votes Thank Flag Link Wed Dec 3, 2008
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