Tips for Buyers
After confirmation with Board of Realtors, the following advice to buyers should not constitute proffering of a legal opinion.
Clause in Purchase & Sales should be included that "Retention of deposit shall be the seller's sole and exclusive remedy at law and in equity." Without this clause and in the event of buyer's default, the seller could sue for an amount greater than the deposit amount. Make sure that if the closing is postponed due to Seller's inability to convey good title, that the buyer can rescind the agreement and get deposit back if because of said delay the buyer loses his/her/their rate lock.
Once there is a breach on ones duties, for example for failure to pay the mortgage payments, the Statutory Power of Sale clause under the recorded mortgage allows the property to be foreclosed on. Notice will be sent to all interested parties and there will be publication of impending auction in a newspaper with a general circulation where the town is located.
The borrower in default has a right of redemption that they can exercise prior to the scheduled auction. Methods of redemption would include selling the property or refinancing with another lender. Contact my office regarding various methods and we will assist in getting the loan paid off prior to the scheduled auction.