Don't try to outsmart the contract!

With the exception of cash buyers, section 8(b) of the real estate contract states "This contract is contingent upon buyer obtaining approval of a loan within 30 days after Effective Date". Upon quick interpretation of this, it seems that if the buyer doesn't get approved for a loan in 30 days, then they are off the hook. However, the contract requires for buyers to be proactive in applying for financing. Paragraph 8 section (i) that states "Buyer shall make mortgage loan application for the financing within 5 days after Effective date" Therefore, if after the effective date, the buyer does not make his or her loan application, the buyer could be in breach of the contract. As such, the buyer could be at risk of losing his or her deposit. It is important to inform buyers that if they sign a real estate contract they must be ready to meet all obligations imposed by the contract or they will be affected.

Remember: When in doubt always ask an expert for their professional opinion. Call me with any questions you may have.