Profile picture for homenewbie

Agent's preferred lender and general mortgage issues

I am a first time home buyer and I just got in touch with a real estate agent that I like.  Shortly after meeting them, they had a senior loan associate from a local thrift savings bank to contact me about getting pre-approved.  When I asked what the rates were, he remarked that they were competitive with the big 6 banks, but nevertheless, I didn't feel comfortable with this. 

A couple of questions, but please, don't restrict your response...
1) Is it typical for an agent to work with a banker?  It seems sort of rushed how they want to get this done.
2) Does this come at the expense of the buyer?
3) Does it seem weird how the mortgage broker hasn't given me any information about the loan, but he wants me to give him my SSN and DOB to get approved for a loan?
4) Because this banker and the agent work together, should I expect them to "sweeten" the deal for me at all?  It seems like they have a working relationship...
5) Should you only be pre-approved by one bank?

Honestly, I don't know where to begin with the loan... It sounds like you don't know what kind of mortgage you're getting into until they actually run your credit.

Thank you for ANY help... You have no idea.
  • May 15 2009 - US
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Answers (4)

homenewbie:
You have many good questions.  Understandably, given the current state of the mortgage industry and what you hear in the media, you have concerns regarding the alliance between your realtor and preferred-lender.
After having been in the mortgage industry for over 30 years, I can only tell you that some of what you are seeing is only natural and can truly serve as a benefit to a new buyer.  Over time and a number of transactions, you discover which of the real estate professionals you deal with share the same professional business philosophy and have a high success (closing) rate.  When it comes to referrals, it is then only natural that you pass on that person's name, as you wish for your clients to work with those professionals that know and understand the business, will do their best for them, and also will successfully complete a transaction.
As far as obtaining your Social Security Number and DOB,
it has also become necessary in this day and age, to request this information before you proceed with almost any other step in the buying/lending process.  Your credit scores (FICO) determines almost every option and decision within the process from the very beginning.  It is near impossible to talk specifics to a buyer before having this information at your disposal. 
I am sure that some deals gets "sweetened", as you say, but is it proper or ethical?  My suggestion is to walk when someone approaches you with this option.  It makes me question the validity of other portions of the transaction and advice given by those individuals.  
Because there are many times costs involved in the processing of pre-qualification/pre-approval of loan to the individual loan officer you are dealing with (or ramifications to them from their lending providers), I would caution you to do your search regarding lenders before you advance your request for information and pricing.  I don't think most customers are aware of this fact.  Although it is expected that there are some initial and simple costs to doing business, putting multiple lenders in a more advanced expenditure can be avoided by doing a preliminary "interview" of sorts before the most expensive costs are incurred or steps are taken.  Many times the decision made regarding the lender used is based on "gut feeling", as pointed out in your post.  Only one of the questions you presented was regarding bottom-line monetary costs.  Most pertained to the impressions you were receiving from your lender and realtor.  You will most likely discover your "gut feeling" pertaining to your lender as easily before those expenditures as after.
Hope that I answered some of your questions and calmed some fears, as well.  If I can offer any further assistance, please write again.  Best of luck!
  • May 18 2009
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In today's market seller's want to see a pre-approval prior to accepting an offer. Go forward with this contact for your pre-approval. You'll still have enough time to shop around once you receive an accepted offer. ...
In my area lot's of real estate professsionals used Countrywide and Wells Fargo for pre-approvals. Then buyers would shop around and use another source (like me) to fund their loan. You also may find that this person will give you a great rate and service. At least for now, go with the flow.

Best wishes, Rudi
  • May 16 2009
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The agent you are dealing with is either really good, and trying to save all parties from wasting time, or really sketchy, and trying to feed a friend.

How long has agent been in business, and same for money man? If they are both grizzled veterans, you are probably in good hands. If they are un-grizzled, they may be up to something, may not.

Also the money guy can't quote you accurately, and on the spot, without knowing your credit score. If you are trying to save time in the transaction, he may just want to discuss your product options with valid data in front of him, rather than speculation. In other words if you come off as in a hurry, this may actually be a courtesy, as in "tell me your vitals, and I handle the rest" when I have accurate pricing and options together, I'll waste your valuable time then"... "what would be a good time for you?" etc...

One more thing, you say he is from a "thrift savings bank", and then you call him a "broker", whichever he is, especially if he is both, he can get you a deal. if you let him, and he wants to. If you excuse him, he can't. Post his offering here, when you get it, and commentary will follow.


  • May 15 2009
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Profile picture for daveskow
 
1) Is it typical for an agent to work with a banker?  It seems sort of rushed how they want to get this done....I agree its a bit pushy / agressive ...most real est agents will pass potetnial buyers  referals or recommendations  for you to contact at your leisure

2) Does this come at the expense of the buyer? pre approval should be free ...avoid thse who will charge you a fee

3) Does it seem weird how the mortgage broker hasn't given me any information about the loan, but he wants me to give him my SSN and DOB to get approved for a loan?...yes ...dont  provide this info until you are  willing and ready to proceed with becoming pre approved

4) Because this banker and the agent work together, should I expect them to "sweeten" the deal for me at all?  It seems like they have a working relationship...unfortunately ..probably not ...maybe customer servce will be above average

5) Should you only be pre-approved by one bank?...in my opinion yes ...but  before becoming  pre approved , you should " shop" or get quotes( backed up with good faith estimates " from several sources ...including this banker person

you should post a quote request on zillow and see what you receive

thanks
  • May 15 2009
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