Buyer Liability

I am on the verge of purchasing my first home. I have a P&S and have
been working with a broker and lender to get financing. I've had the
appraisal done and I received a commitment letter from the lender.
Then I discovered that the terms I discussed with the broker are
different than the terms in my commitment letter. The broker
apologized for the "confusion" and has arranged to have another
commitment letter drawn up. But I also discovered that this particular
lender has a bad report card with the BBB.

My question is, since this broker already did the appraisal and some
other "legwork", albeit not very impressive, what is my liability to
them? I have found a better offer elsewhere with a lower interest rate
and I am seriously thinking about switching gears. I may also need an
extension on the closing date, but it seems worth making this request
given the circumstances.

Any info is appreciated.

Re: Buyer Liability

As I'm not a lawyer, I cannot provide legal advice. However, with my
disclaimer out of the way, my general understanding is that your banker has
to abide by the commitment letter, or there are several courses of action
that can take place.

1st, you can (through court proceedings) force the lender to proceed with
the original commitment letter, being that you have financially relied upon
it. Or 2nd, you can walk being that they have broken the contract. That's
why contracts are legally binding, so no party can say... oops, there was a
misunderstanding; in order to financially benefit themselves at the expense
of the other party. If you do walk, make sure you retrieve any monies you
gave the first banker, like application fees, etc, since they were all based
on the first commitment letter. If they fight it, you can show that what
they pulled could be construed in court as a "bait and switch" or other
illegal activities, and they could potentially lose their license or be
fined or both.
"J" <> wrote in message
news:
>
> I am on the verge of purchasing my first home. I have a P&S and have
> been working with a broker and lender to get financing. I've had the
> appraisal done and I received a commitment letter from the lender.
> Then I discovered that the terms I discussed with the broker are
> different than the terms in my commitment letter. The broker
> apologized for the "confusion" and has arranged to have another
> commitment letter drawn up. But I also discovered that this particular
> lender has a bad report card with the BBB.
>
> My question is, since this broker already did the appraisal and some
> other "legwork", albeit not very impressive, what is my liability to
> them? I have found a better offer elsewhere with a lower interest rate
> and I am seriously thinking about switching gears. I may also need an
> extension on the closing date, but it seems worth making this request
> given the circumstances.
>
> Any info is appreciated.
>