Legal Question in Real Estate Law in Florida

Can a mortgage company repeal prior loan approval on closing day for no valid re

My mother is selling her house, appraised at 145k, for 85k because she has moved and wants to sell quickly. The buyer's mortgage company preapproved the buyer for $95k and a closing date was set. The date was pushed back several times because the certificate of final loan approval was not received by the attorney handling the closing. The mortgage company repeatedly said the paperwork is in the mail. Suddenly, the mortgage company says something must be wrong with the house due to the low price. They refuse to grant the certificate of final approval, and tell the buyer's agent that they don't believe the appraisal and they would like to get a new appraisal. The buyer agrees and offers to pay. Mortgage company again backs out and says that they don't want a second appraisal afterall, but instead, they are revoking the preapproval. House inspection was fine and termite clearance letter was done.

Surely, the mortgage company has not acted in good faith as their unsupported contention and outright lies to the buyers agent led to the multiple closing date postponements and the above described outcome. Is there any legal recourse?


Asked on 2/12/02, 8:55 pm

1 Answer from Attorneys
Peter Gonzalez Sanchez-Medina, Gonzalez, Quesada, Lage, Crespo, Gomez & MachadoLLP

Re: Can a mortgage company repeal prior loan approval on closing day for no vali

The person with legal recourse, if any, would be the buyer, not the seller. If the home has a market value of $145,000, it is ridiculous to sell it for $85,000.00, unless $60,000.00 means absolutely nothing to your mother, she is making a terrible mistake. Selling it a little below market value is one thing (e.g., $135,000), but flushing $60,000 down the toilet is quite another. Consult with a real estate broker and have him/her find you a qualified buyer that's willing to pay market value. Good luck.

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Answered on 2/13/02, 11:33 am


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