Legal Question in Consumer Law in Pennsylvania
Loan rejected but recieved money anyway
About seven years ago I applied for a home equity loan from a local bank. At first the loan application was accepted but when a title search was conducted it was discovered that my ex-girlfriend with whom I purchased the property was still on the deed. The original contract was returned to me as it only had my signature, and I was informed that it would be necessary for her to also sign the application for the home equity loan to be approved. Then, without an original signed contract the bank sent the money electronically to my checking account. Since the time the money was deposited into my account I have been paying the bills regularly. The bank keeps on asking me to get my ex-girlfriend to sign the application. A recent call to the bank indicated that it has been impossible for them to put a lien on my property because they don�t have an original contract signed by both parties on the deed.
At this time I have paid most of the principal of this loan and my question is, am I obligated to the terms of loan even though I was actually rejected and the bank has no contract? I do intend to pay all of the original amount but perhaps no interest?
1 Answer from Attorneys
Re: Loan rejected but recieved money anyway
You know the answer to that question. Of course you're obligated to pay the loan and the interest, as you agreed to.
Do you really think you could take the money, comply with the terms of the loan for 7 years, and then walk away? Of course not.
The issue with the mortgage and lien, and the lack of the co-owner's signature, only deals with the bank's ability to foreclose on the property if you don't pay. Your obligation on the loan is completely separate from that. The bank will have other ways to collect if you don't pay, like a lawsuit against you personally.
Also, have you considered that sooner or later, when you want to sell the property or refinance, you're going to need the ex to sign off?
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