Is it legal to award a loan and then rescind it?

I recently applied for a personal loan from a company and I received an email stating I was approved and my funds would be deposited within 3 days. However, 30 minutes later I received an email stating my loan application was denied. I’ve called and they are just telling me my loan was denied and not giving me a reason. Based upon my approval email I have promised to pay a bill that I otherwise couldn’t pay without the loan.

Asked on October 8, 2014 under Business Law, Utah


Anne Brady / Law Office of Anne Brady

Answered 6 years ago | Contributor

An email is not a binding contract.  It is a one-way communication.  So long as they did not sign any actual loan documents with you, they can change their minds about giving you the loan.  It happens with car dealers quite often. 

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