John G. Bonomi Jr, 66, bought the five-bedroom property in Wellfleet, Massachusetts, in 2021 despite coastal erosion threatening the site. The house was demolished in March 2025 after authorities warned it could collapse into Cape Cod Bay.

Bonomi, who was diagnosed with Bipolar I Disorder in 2009, argues JPMorgan Chase should never have approved the loan because he lacked the capacity to enter into the agreement. He alleges the bank knew, or should have known, of his condition.

The bank denies the claims. Legal experts say Bonomi faces a difficult burden of proof, although New York law allows contracts to be challenged on mental capacity grounds in limited circumstances.