WA Can Builder Force Us to Pay Incurred Costs?

[fromoz]

Our build contract was valuated really low by evaluator. Removed items to reduce loan but valuation dropped with it. We told our builder we can't build. We took off as much as we could off the building contract but they wouldn't help with the discount and our valuation dropped anyway.

We asked the broker to send us a finance rejection letter. We forwarded it onto our builder. They sent us a letter that states we need to pay $20, 000 approx for incurred costs as we are cancelling the contract. We have no choice and we can't get finance approval. My wife now hasn't got a job.

Can they force us to pay incurred costs (we signed the building contract)?

 

[Lance]

Hi,
It really depends on the contract terms and conditions. Read through it very carefully and see if you can find any out clauses. Look for things like in the event of finance falling through. Sorry I cant be of more help but its hard to answer without reading the contract.

 

[fromoz]

Hard to see in the contract about no finance due to low valuation. We got unconditional finance to build but not on the valuation of house.

Could the letter be a scare/bully tactic to make us pay or to build?

Legal advice is expensive

 

[Lance]

It could be a scare tactic. You could try reasoning with them. They cant get blood from a stone. Sometimes bearing your soul to them can see them back off.