What is my liability if I backed out of buying a house because I lost my job?

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What is my liability if I backed out of buying a house because I lost my job?

Approximately 3 months ago I put an offer in on a house that was accepted. It was only contingent on obtaining financing. It was supposed to close on the 19th of last month. Well I was approved for my financing but then on the 16th I lost my job. When I told my loan officer he said I would be denied. The denial letter was taking awhile because he said it had to go through underwriting. Well in the mail today, the seller sent me court papers to go to court because we did not close. First of all, he is sueing me for is $250 in earnest money which I did not agree to and I did not initial the changes in the contract. Second, my financing did not go though because I lost my job. Is he going to be able to get anything from me?

Asked on February 6, 2012 under Real Estate Law, Ohio

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Did you get the letter from the underwrteradvising that the loan was denied?  Really what you shouldhave done waswrite a letterto the seller as soon as you lost your job advising of the situationand that you had been advised that you would lose your finaicing.  Have the loan officer call the attorney and advise the same.  I think that in the end it will work out for you once a judge hears your side but you need to make sure that fit in the "out" in the contract.  File an answer in the proceeding denying the complaint and asserting an affirmative defense that you were denied financing because you lost your job.   Good luck.  


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