finance clause
- Thread starter Kiwibaz
- Start date
As long as you've made "best endeavours" and acted "in good faith" and the bank has not confirmed either way you should be able to get out.
But it depends on what the vendor was expecting.
Either approval from the bank or a letter declining your loan.
Given that the time has expired and you have made every effort to get approval and it's just the bank's tardiness I would say that's an out.
But seek legal advice.
Seen these things go south very quickly.
But it depends on what the vendor was expecting.
Either approval from the bank or a letter declining your loan.
Given that the time has expired and you have made every effort to get approval and it's just the bank's tardiness I would say that's an out.
But seek legal advice.
Seen these things go south very quickly.
Hiya
Im not a solicitor.................
If the seller wants to push the argument,they will give u an extension...........
If u dont want to proceed find some more solid way to get out
t
arolf
Im not a solicitor.................
If the seller wants to push the argument,they will give u an extension...........
If u dont want to proceed find some more solid way to get out
t
arolf
Possibly not. There was a recent wa case on this. In the last 12 months or so. Seek legal advice quickly.
I can recall two cases in the last few years, one in WA, where the buyer was unable to provide a written decline for a bank and thus lost a deposit. It's not difficult to get a loan declined if you've got a half decent reason. Earlier this year a client called me on the day we were expecting the bank to approve a loan and said he expected to be made redundant and would have trouble getting another job anytime soon. A quick phone call and then an email to the bank (to put it in writing) and we got a formal decline letter to satisfy the vendor.
Slightly different to what I remembered:
Dodds v Kennedy [No.2] [2011] WASCA 131
http://decisions.justice.wa.gov.au/supreme/supdcsn.nsf/PDFJudgments-WebVw/2011WASCA0131/$FILE/2011WASCA0131.pdf
Buyer failed to make a loan application at all. Still worth a read.
Dodds v Kennedy [No.2] [2011] WASCA 131
http://decisions.justice.wa.gov.au/supreme/supdcsn.nsf/PDFJudgments-WebVw/2011WASCA0131/$FILE/2011WASCA0131.pdf
Buyer failed to make a loan application at all. Still worth a read.
Reading your question and subsequent post more specifically I've realized we've generally indicated that you need to apply for a loan in order to get it declined, but you've indicated that you have actually applied for finance.
In this case your conveyancer or solicitor should make it clear that you have applied for finance but an approval has not been received by the due date. They should advise the vendors that either the finance clause period needs to be extended or for the contract to be cancelled.
This is really bad advice and I don't know what I'm talking about.
From what I understand, your only scot-free way out, using the finance clause, is if you apply with the named broker or financial institution and don't receive an official approval letter from them by 4pm on the date noted on the contract.
Applying with a different institution and getting refused finance does not get you out of it.
NOT applying with the named institution does not get you out of it.
Taking 3 weeks to sign the loan docs and delaying the approval letter, could very well get you out if it.
From what I understand, your only scot-free way out, using the finance clause, is if you apply with the named broker or financial institution and don't receive an official approval letter from them by 4pm on the date noted on the contract.
Applying with a different institution and getting refused finance does not get you out of it.
NOT applying with the named institution does not get you out of it.
Taking 3 weeks to sign the loan docs and delaying the approval letter, could very well get you out if it.
I really doubt that would stand up in court. The first witness would be the broker and the first thing they'd ask the broker is when was the loan submitted. It would go swiftly downhill from there.
If you want to make a loan applicaiton fail, it's really simple. You ring your broker or banker and tell them that you've just lost your job and you don't think you should proceed with the loan because you don't beleive you'll be able to make the repayments.
You probably don't want to lie about any of this though. If it got persued far enough it would be discovered that lying about loosing your job for these purposes is essentially fraud, which potentially carries jail time.
I really doubt that would stand up in court. The first witness would be the broker and the first thing they'd ask the broker is when was the loan submitted. It would go swiftly downhill from there.
If you want to make a loan applicaiton fail, it's really simple. You ring your broker or banker and tell them that you've just lost your job and you don't think you should proceed with the loan because you don't beleive you'll be able to make the repayments.
You probably don't want to lie about any of this though. If it got persued far enough it would be discovered that lying about loosing your job for these purposes is essentially fraud, which potentially carries jail time.
Blast! Foiled!
So, just quit your job mid-application?
It's not that hard to kill a loan application. Getting one resurrected is a lot harder
Quite true, but it can be a trick to get a good application declined without lying just in case the vendor gets nasty and tries to persue it anyway (which doesn't happen often, but it does happen).
One of the more amusing applications I watched die a horrible death, was when the applicant worked for the same lender. The deal was in trouble (and I was already getting tired for fighting for it). The applicant used his inside knoweldge to find the assessor, rang the assessor and started abusing them. When the assessor rang me asking, WTF, I readily agreed that it probably wasn't a good deal and shouldn't proceed.
The phone call with the client that followed wasn't quite so funny at the time, but I do laugh about it now
Similar threads
