Legal Question in Real Estate Law in Massachusetts

: purchase and sales agreement

Since you asked, this deal reeks. Having signed the PS, she should get in touch with an attorney to see if there is anything she can do to escape this charade.

Re: purchase and sales agreement

If she signed very recently, check the P&S for a clause permitting a recission of the agreement w/in 3 days. If still w/in that, not sure she'd need any reason at all.

If not (the likely scenario), its a little bit of a sticky spot to be in, but probably can be taken care of without consequence beyond loss of the deposit - which I suspect will happen for sure. But this needs to be handled delicately and well; perferably by an attorney. The risk of not handling it right could bring on exposure for fraud, even bank fraud. That's unlikely, but possible; how the situation is handled will significantly influence whether or not she sees trouble from this.

She might consider saying she read through the fine print after signing, and through her diligence went back and double checked all of her financial representations to make sure the information she provided was accurate; she found some material discrepancies b/w the finances she represented on the loan app and her actual situation. She could say that b/c she respects the importance of the context - bank loand and home sales - she does not want anyone to be forced to proceed based upon her mistaken information, and she felt she should make full disclosure to all involved as soon as she could, and thought doing so before the funds were actually drawn down. That will probably telegraph exactly what actually happened, but at least she didn't go thru with it; these lenders probably see this regularly, and many times the discovery is after the loan is made or the home just ends up being foreclosed upon -- b/c people who have to inflate their finances to qualify for loans generally shouldn't take loans that size.

Especially for someone else. Does she (or you) have any idea the gravity of the situation she could (would is my guess) be in if they broke up? He could live in that house until he dies - with his new wife and kids - and she would be forced to make every mortgage payment until the loan is paid. Its absolute recklessness and sheer madness.

Re: purchase and sales agreement

The best thing is to hire a lawyer to attempt to negotiate you out of this situation --- the sooner the better. It has to be handled gently. The longer this goes on, the more difficult the extraction, very much like the Iraq war.

Re: purchase and sales agreement

She needs to get to an attorney ASAP. She might lose the deposit and she might not.

If she should not lie on her mortgage application.

Get her to an attorney.