Under Massachusetts law and real estate practice, several rules govern the mortgage contingency in a purchase and sale agreement. Which of the following statements about the Massachusetts mortgage contingency is EXCEPT correct?
Correct Answer
D) A verbal mortgage approval from the lender before the contingency deadline satisfies the written commitment requirement
A verbal mortgage approval does NOT satisfy the written commitment requirement of a standard Massachusetts mortgage contingency. The mortgage contingency specifically requires a written mortgage commitment from the lender by the stated deadline. Verbal approvals, pre-approval letters, and conditional commitments are not equivalent to a formal written mortgage commitment. This statement is incorrect, making it the answer to this EXCEPT question.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Equitable title is the buyer's interest in a property after a purchase contract is signed but before closing, giving the buyer the right to acquire legal title in the future. The seller retains legal title until the deed is delivered at closing.
A financing contingency makes the purchase contract conditional upon the buyer obtaining mortgage approval within a specified time period. If the buyer cannot secure financing, they can cancel the contract and receive their earnest money back.
An inspection contingency gives the buyer the right to have the property professionally inspected within a specified time frame and to negotiate repairs or cancel the contract based on the findings.
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