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How do you back out when you've signed everything but the loan contingency?

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  • May 01 2014 - Los Angeles
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Answers (5)

A loan contingence is a fancy way of saying I can only buy this home if I qualify for the loan and until you sign a removal document stating you no longer have a loan contingence it could be a way out if you can't qualify for a legitimate reason.

But be aware that with all legal transactions and documents that it just isn't black and white and everything in writing has to be reviewed etc.. You may also be subject to mediation depending on whether or not you or the seller or both signed agreeing to this in a dispute.

Just be aware these things are not always as they appear. Real estate attorneys may be needed.
  • July 29 2014
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Profile picture for toddbazik
The Loan Contingency means just that - it is contingent on you being able to obtain financing.  If you are unable to obtain financing and have not yet signed off on the loan contingency, you are entitled to cancel the transaction and receive a refund of your earnest money deposit.
  • May 13 2014
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Your contract defines what options you have and what you can expect if you fail to close the sale.  Hopefully you have an agent that understands the contract and your options.  You also may wish to consult an attorney, but it is unlikely that an attorney can change a contract that has already been executed.

It sounds as if you still have a financing contingency. If so and your financing does not go through you may have an exit.

Of course, no one can force you to close the deal, but it may cost you to get out of it.
 
  • May 01 2014
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Profile picture for brett homes
Sounds like you may need a real estate attorney to review what you have signed or did not sign and explain to you your options. 
  • May 01 2014
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Backing out now would mean a loss on the down payment unless the loan was refused for some reason. Depending upon the circumstances there might be other penalties as well.
  • May 01 2014
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