Can my husband and I get sued, after walking away from attempting to purchasing a home?

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Can my husband and I get sued, after walking away from attempting to purchasing a home?

We got pre-approved, then after making an offer (which was accepted) the bank said they could no longer pre-approve us. So, we got a co-signer, as suggested by the bank, and found out the bank was using the co-signer as a co-borrower. So, we walked away from the deal. Can my husband and I get sued (along with the third party) b/c the bank did not make it clear they were going to use the co-signer as a co-borrower?

Asked on June 21, 2009 under Real Estate Law, Ohio

Answers:

J.M.A., Member in Good Standing of the Connecticut Bar / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

I am a lawyer from CT.  A co-signor and co-borrower are one in the same.  A person that co-signs guarantees the debt to the bank.  You are as liable as the co-signor.  I would need to see the real estate contract to fully answer your question.  What was the mortgage contingency clause saying about this?  Usually, if you cannot obtain a mortgage, you can walk away.  Here, it seems you got a mortgage but then didnt want to do the deal becasue you didnt know what a co-signor was.  I think that the sellers will be able to enforce the contract or at the very least keep your deposit.  Without seeing the contract i cannot give you a better answer.


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