Legal Question in Real Estate Law in Illinois
defrauding lender
i sold a house to a gentleman. the origan agrement was i was to pay his closing cost but it wasn`t in the contract. so at closing he showed up with no money. so i wrote him a check for closing before i realized the closing cost would come out of money i was making on propert. so i canceled the check. now the guy is tring to sue me for the amount i wrote him the check for saying it was for repairs. does this guy have a case. or can i report him to someone for trying to defraude the lender? --name removed--consola
2 Answers from Attorneys
Re: defrauding lender
I'm not sure what you mean by "defrauding the lender." Real estate deals frequently call for a Seller to pay a Buyer's closing costs so that's a non-issue. Has a lawsuit been filed? There's a law regarding civil damages for bounced checks that I think would be this guys strongest case against you. If he brings a cause of action as part of the real estate transaction you may have some defenses based on a legal principal called the "merger doctrine" which practically means that once a real estate deal has closed you cannot bring lawsuits based on pre-closing contract issues. How much $$ is at issue?
Re: defrauding lender
Cancelling the check might be a big problem for you. I would be careful with alleging that he defrauded the lender, since you both signed a settlement statement stating that all receipts and disbursements were itemized on that settlement statement. Essentially, it sounds like perhaps you both were involved in mortgage and/or RESPA fraud.
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