Buyer Default - Mortgage

This section discusses only Buyer default for the mortgage. Paragraph 22(E) includes this information as well as two additional clauses. Buyer must work closely with the agent to plan for timely submission of all required items.

Subparagraph 8(D) reads: ”Buyer will be in default of this Agreement if Buyer furnished false information to anyone concerning Buyer’s financial and/or employment status, fails to cooperate in good faith with processing the mortgage loan application (including delay of the appraisal), fails to lock in interest rate as stated in Interest Rate, or otherwise causes the lender to reject, refuse to approve or issue a mortgage loan commitment.”

Combined with Para (B) & (C)

Buyer is obligated to lock in an interest rate 15 days before the Settlement Date as required by Interest Rate in (B). Buyer must make application for financing and pay the lender for a credit report and appraisal when asked as required by Mortgage Application in (C).

Note: One of my Buyers developed an extreme case of “remorse” that resulted in a poor attempt to sabotage the mortgage by quitting his job. The Buyer told the mortgage company he ‘lost’ his job and could not possibly qualify for the mortgage. This surprised everyone involved. The mortgage lender and I worked with the Buyer as the Seller (and agent), and employer patiently waited. The Buyer, after 4 days, was able to sit down, resolve the panic and return to work. This is when I decided to include ‘buyer remorse” as part of my initial meeting with all Buyers.

Return From Buyer Default To Part 2 – Mortgage Contingency