Q: Can I Sue a mortgage broker for breach of contract and damages?
Long story short... We had a flood in our home. The contractor we hired tore out most of the inside of our home and then took off with the insurance money. So.. we had no other choice but to take a loan out on our other property, which was fully paid off. We hired a new contractor, who suggested a mortgage broker. The contractor also came to the meetings with the broker. It was talked about, decided and put into the loan contract that the broker would be responsible for payments to the contractor. He would come to our home and check off on the work that had been completed before he would sign off on the next payment to the contractor. We had it this way because my husband and I are very trusting people, and tend to give people the benefit of the doubt. My husband would sign for the payments but they were to be approved or denied by the broker before funds would be released. The broker never came to our home. He approved each payment. The contractor left with all of the money.
A: Okay, if I understand what you've complained about, you have several issues and I'll take one at a time:
First: the first contractor basically started tearing the inside of your house apart and then split? In Idaho you have the right to require the first contractor to either finish his work or you will have the right to sue under the Notice and Opportunity to Repair Act, Idaho Code 6-2501 et. seq. This seems like the most damage to your property of all the other issues. I would defenitely see what I could do here first. However, since Idaho is a "right to work" state, you won't be able to call his Union Rep to "yank his chain" and you'll have to find him yourself.
Second, you hired a new contractor who did a portion of the work, then your husband approved his work, and requested the Broker release funds? If this is true, then the new contractor only received the money that your husband approved of, right? Your husband actually wrote the checks, why didn't your husband personally approve of the quality of work done before asking the Broker to release the funds? Why was your husband put in charge of signing for the payments? I think the broker has a cause of action against your husband for asking for money to pay the contractor even though your husband never saw the work? for signing off on payments that he should not have signed for. If the money was coming from the Broker, why did the Broker rely on your husband's approval of the work?
Further, your statement "took all our money," is not true. The ONLY money the contractor took were payments that your husband approved of, before the Broker would release the funds. You can't sue the Broker for relying on your husband's signing off on all the work of a given section before the Broker released the funds? If he released funds, it was only because your husband approved the work and then wrote the checks. The Broker didn't breach his duty to you. I recommend that you stop referring to yourselves as "trusting" and instead refer to yourselves as "ignorant" and "negligent."
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