Baltimore, MD asked in Contracts and Real Estate Law for Maryland

Q: What is the legal definition of when you have "secure financing" in the sale of a house? From case law or regular law?

If a contract says that a buyer has to "secure financing" by X date what is the actual interpretation of that? Do they need to be able to close the loan and sale or just show they have applied for a loan or just a pre-approval?

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2 Lawyer Answers
Mark Oakley
Mark Oakley
  • Rockville, MD
  • Licensed in Maryland

A: More than pre-approval. You get a commitment letter for financing from the lender, usually with a proviso that none of the borrowers qualifying information changes.

Bruce Alexander Minnick agrees with this answer

A: It means the borrower has to be approved for financing by a certain date or else the contract can be cancelled by the seller.

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