Do I have the right to go after a financial institution due to its negligence which will prevent me from purchasing a house that I was supposed to buy?

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Do I have the right to go after a financial institution due to its negligence which will prevent me from purchasing a house that I was supposed to buy?

I applied for a mortgage and the lender pre-qualified me for an USDA loan. The lender gave green light for me to make a bid. After I found the house I wanted I got an approx. of what my monthly payment would be, which fit into my budget. Sellers accepted a percentage of my closing costs that my realtor asked for. Earnest money has been paid. Lender went on vacation with no way to be in contact. Their manager took over my application only to find out that I do not qualify for the USDA loan. Manager qualified me for a different loan, which the monthly payment is out of my price range. I will most likely lose the house.

Asked on December 24, 2015 under Real Estate Law, Washington

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

No, they are not liable for this. First, lenders do not have to lend to you, and you have no guaranteed right to a loan; hence, there is no liability for failing to lend to you, or not making some particular kind of loan. Second, the pre-qualification is not a guarantee of or commitment to a loan; it is just a statement that a preliminary (not final) review makes it appear you could get a loan. Third, no loan is final until aftet underwriting and you get the actual loan approval or commitment. Foueth, ultimately it is your own finances that wil cause you to not get the home...you applied for a home you could oly afford if you got one particular kind of loan, instead of one you could afford with any mortgage.


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