In this recent case, the defaulting defendant was ordered to pay damages close to $170,000.00 when they were unable to secure mortgage financing after delivering a “clean-offer” to purchase a property. The opening paragraph sums up the frustration, and folly, surrounding the “hot” real estate market:
“The biggest investment that most people will ever make during their lifetime is the purchase of a home. Most, but not all purchasers, will require mortgage financing to purchase a residence. The purchase of a residence usually entails the execution of a standard form of Agreement of Purchase and Sale. Where mortgage financing is required to complete a transaction, it is not uncommon for a purchaser to insert a condition that the purchase is conditional on obtaining financing. In recent years, the frenzy of the real estate market has often caused purchasers to present a so-called “clean offer” that is not conditional on financing or a home inspection. Purchasers who continue to adopt this practice without secure mortgage financing do so at their peril. The facts of this case, unfortunately, demonstrate this unfortunate outcome for the Defendant.”
Masoomi v. Chen, 2022 ONSC 703
https://www.canlii.org/en/on/onsc/doc/2022/2022onsc703/2022onsc703.html