I was pre-approved for a mortgage, but I think I want to rent. Are there penalties for backing out? I haven't found a house yet.
2007-05-28 04:07:57 · 5 answers · asked by Constance P 2 in Business & Finance ➔ Renting & Real Estate
Oh no, there aren't any penalties. They give you an estimate of the costs. You are in no way restricted to now buy a home. Don't worry! Just tell them you aren't interested and don't let them tell you a whole bunch of crap!! Stay strong! They can be pretty pushy...Buying a home is a HUGE deal, don't let them push you into something that you aren't ready for. Good luck and remember you don't have too!!
2007-05-28 04:14:13 · answer #1 · answered by stephbrown2005 2 · 1⤊ 0⤋
The only thing you might lose is the credit report fee although not all mortgage brokers charge for the credit report. Being pre-approved or pre-qualified only means that you can by a house, not that you have to.
If you had found a house, put in a contract, and paid earnest money, then the earnest money would have been forfeit as well as your inspection cost and your appraisal fee. But since you hadn't gotten there yet, you should be able to walk away free and clear.
2007-05-28 12:01:34 · answer #2 · answered by Dawn J 4 · 0⤊ 0⤋
Have you signed any paperwork? If so, check that closely - that will tell you what your rights and responsibilities are.
Have you paid any fees yet? If so, they may be forfeit.
The best resources would be to talk to your realtor and the mortgage company or broker. If you have any questions, however, you should take the paperwork you have to a real estate lawyer. However, be careful - you may end up paying a lawyer more to get you out of the deal than you would to just pay a cancellation penalty, if any exists.
2007-05-28 11:15:54 · answer #3 · answered by Ralfcoder 7 · 0⤊ 0⤋
Pre-approved just means that they've assisted you in determining what you can afford based upon current ratesand makes the realtors love you. Even it you FOUND a house, that doesn't mean that you have to get your mortgage through them.
There are lots of reasons for waiting and renting in the current economy as housing prices are dropping. You don't have to tell them anything. Just let your agreement expire, it's rate tied anyway.
You're fine.
All the best!
2007-05-28 11:22:15 · answer #4 · answered by bookish 3 · 1⤊ 0⤋
I don't know of any mortgage companies that charge for being pre-approved. I have been in real estate sales in Texas for 29 years and never heard of any penalties for changing your mind at the stage you have described.
2007-05-28 11:15:49 · answer #5 · answered by glenn 7 · 0⤊ 0⤋