Can I sue for bank neglect?

Question

We won a house auction on June 20, 2007. As soon as we did, the following day my husband and I applied for a loan. The lender, told us we were gonna close in 3 weeks. Between the day we applied for the loan and 2 days before closing we tried to contact the bank lender more than 30 times. He informed us we needed supplemental papers a week before closing and said we were gonna have an answer (wether approved or not) on June 18, 2007. On this day, we called him and he said he handed the responsibility to someone else in charge. This lender/bank know that if we fail to close on the 20th of June, we lose the downpayment made to the house.

Okay, now before we made the loan, we had to give 5% downpayment to the bank who owned the house. In the contract with the auction people, it is stated that extension for the closing is optional and is 150$ every day including the weekends.

Today, we talked to the person in charge with our loan and he said best case scenario is to get an answer in 2 wk

... so now, if we do not extend and pay 150$ everyday for 2-3 weeks, we lose the house and we lose our down payment.

My question is, it was obviously the negligence of the bank that is leading us to lose money (not to mention the fact that the bank manager has been informed of the lender's negligence of informing us, and misleading us a week prior to closing )

Can we sue?

We dont have a problem getting approved, we are racing with time here and the bank slowed things down with negligence and misleading information

OMG Half of the people here dont know what theyre talking about. There should be a viable property so the bank can check and research if the property is worth the money being loaned for! Omg unbelievable! Having a property to loan for is the first step to getting a house loan.

TIME LINE: Sorry it was supposed to be closed on July 20th.

Answer 1

The neglect is yours. You should have gotten pre-approved for the loan prior to going to the auction. You would then have known how much you could spend and the loan would have already been approved. Once you failed to do that, you should have sought a loan from several banks to ensure that you had the money in the appropriate time frame. Trusting someone else when you knew the consequences was your mistake not the banks.

Answer 2

You can consult an attorney, but it doesn't sound like you have much of a case.

First, your timeline doesn't match up. You won the auction on June 20, then applied for a loan on June 21, but say that you were supposed to have approval by June 18 (three days before you applied)? Also, you say you had to close on June 20th or begin paying a penalty? How could you possibly expect to close on the 20th if you hadn't even applied yet? It's not uncommon for the entire process to take 30-45 days, so it was unrealistic to expect to close on June 20.

Answer 3

Well, anyone can sue for anything....that being said. I'm surprised that you did not have to give proof that you had already been approved for a loan before putting the down payment or winning the auction bid.

I hope that all works out, but unfortunately this is probably a hard lesson learned.

Answer 4

Better get a lawyer! This ain't gonna be pretty.

You can sue anyone for anything, but I don't know if you'll have a case. That's what lawyers are for.

Also, shame on you for getting into a fixed-term contract to buy, with your cash on the table, without already having a source of financing lined up!!!!

Experience is a great (but sometimes painful) teacher!

Answer 5

You have a strong basis for sueing the bank. I suggest you contact the lawyer and take is advise on pros and cons. He may charge his professions fees for the advise, but it is a wiser step to consult him/her before plunging into litigation.

Answer 6

I don't think so. Why on earth didn't you set up your financing BEFORE you bid on the house?