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My real estate agent asked for my loan officers information...

After finding a house, and signing a contract on it, we submitted a loan application to our loan officer. Our Real Estate agent asked for their information, saying they would need to communicate with each other. About what? The Real Estate agent did their job, I am sure they will receive their commission for the sale. What would these two offices need to discuss, that they could not discuss with us, the buyers?
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January 27 2013 - Alabaster
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Answers (25)

There is a lot that will be discussed and just let your agent know to forward all questions to you and you can pass them along.  

Side note: if you have given your agent a copy of your pre-approval letter, the agent should already have your lenders contact info.
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January 31 2013
Was your loan officer attractive?

It seems obvious that you and your agent were complete strangers, meaning, that he/she didn't come on a trusted referral or with validated testimonials. Because trust is so essential to the relationship between buyer's agent and buyer, when it is lacking it causes the kind of misgivings that you experienced.

To somebody without real estate experience and a slightly paranoid view of the world, it might seem that your real estate agent was trying to get your bank information to buy a new Armani suit so that he could impress your attractive loan officer on their first date.

But since buyer's agents rarely get paid up front, and it is still one of the few professions in America where the client has zero financial responsibility to the servicer, many pragmatic souls would assume that this probably not entirely altruistic real estate man might want to verify if he is actually going to get paid!
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January 30 2013
Communication with all parties is the key to make the transaction as smooth as possible.  Without communication we all fail to represent our clients to the best of our abilities.  There are so many things involved in the transaction other than showing a home and writing an offer.  It takes team work from everyone....buyers agent, sellers agent, lender, title company and the clients.
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January 29 2013
Hi User,
I always know who my clients' lender is BEFORE we sign a contract. I need to know they are pre-approved before we waste everyone's time looking at homes they can't afford, or don't feel comfortable paying the payment that corresponds with that price. I do a lot of coordination with the lender throughout the process to make sure that my client adheres to the contract as far as loan approval, loan contingency removal and, of course, closing date. For example, providing documents, coordinating appraisals, making sure certain credits, price changes, etc. are OK with the lender. These things can hamper the closing process and cost my client money and time. I should mention that none of these functions requires the disclosure of any personal financial information, that is not any of my business, but you can see why coordinating with the lender is an essential function of a real estate agent that is beneficial to all. I can't speak for any other agents, or try to imagine what percentage are what, but I can for sure state that I always 100% have my clients' best interest at heart. I take very seriously my fiduciary responsibility. It is not just a matter of legal responsibility, but a moral and ethical responsibility.

OK, stepping off soap box.... Good Luck!
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January 29 2013
It is really important for your loan officer and your real estate agent to be in touch with one another throughout your real estate transaction to make sure everything goes smoothly.  For example, your loan officer can let your agent know when the appraisal has been ordered and when it comes back completed.  If your real estate agent has your loan officer's contact information, he or she can check in with them a week or so from closing to make sure that the loan documents have been submitted to underwriting and that they will be arriving at the escrow office in plenty of time for both the buyer and seller to sign to make sure the transaction can close on time.  The more communication between all the parties involved, the real estate agents, the lender, the title and escrow companies, the better!  Good luck!
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January 28 2013
I have to agree with Sunny here....I call shenanigans on "However, I do think it takes a certain type of person to become a licensed realtor, and thats an honest and ethical person."

There are a variety of reasons people go into real estate. Some do it because they love houses, some think it sounds like a fun/easy/interesting job, some do it because it has a low barrier to entry, etc. Many of the reasons are totally neutral to or even contrary to honesty and ethics.

@user3719773
There is a lot of coordination that needs to be done between the transaction parties and the lender. It can be extremely helpful to have an agent playing "go-fer," which I personally feel is part of the compensation. Lenders regularly require information on a transaction on fairly short notice. You might be at work/busy and unable to get to something your agent can easily access. There are also deadlines the other way, like loan commitment letters that the lender may lose track of dates on.
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January 28 2013
Profile picture for sunnyview
"However, I do think it takes a certain type of person to become a licensed realtor, and thats an honest and ethical person."

Sorry I can't agree. There are bad apples in every profession including real estate. Trouble I see is that many clients do not know if they have chosen a good agent until the deal is done. It is much like getting married, your fiance looks like a keeper or you would not take them to the altar, but you simply don't know what you don't know so many marriages end in divorce.

Not all agents are 99.9% good where I live or anywhere. There are great agents, agents that are competent and trustworthy, but there are some that are not. Clients need to be cautious and not write any agent a blank check of trust. Smart, informed buyers are happy buyers. 
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January 28 2013
In reply to sunny view - you are correct.. Not every agent is a great person. Buyers should remember that they can choose their agent and hopefully ones intuition will serve them well enough to select an honest agent. However, I do think it takes a certain type of person to become a licensed realtor, and thats an honest and ethical person. Maybe I just tend to see the good in others but out of thousands of realtors I have interacted with I would say 99.9% have done a good job of representing their clients best interest and the point 1 tried but lacked experience =)
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January 28 2013
Profile picture for sunnyview
"Your agent asked for your loan officer contact info so they can work together as a team..."

There is value as a client in having your agent work for you and having your broker work for you. However, they both should be on YOUR team as the buyer and not a double team that is primarily interested in closing the deal. I have seen that happen more than once to the buyers detrement so I am weary of that.

There is value in maintaining each professional on your buyers team in their respective roles and assuming the role of an informed hub between them.
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January 28 2013
Your agent asked for your loan officer contact info so they can work together as a team and when you get to the point of settling, your agent will need that information as well so all 3 professionals can be on the same page of what is going on. Having the loan officer information is not to dig up your financial information, it can be something as simple as having another letter sent while you all are negotiating on another price with the seller. Overall it's important for everyone to work together to make sure everything runs smoothly. If one of the 3 professional are not aware of something, it can cause a lot headache and being in contact will save them all from that.
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January 28 2013
Profile picture for sunnyview
"Remember your real estate broker has a fiduciary, responsibility to you the client so they are always looking out for you to get the best deal!"

Do you feel that ALL agents represent their clients interests 100% of the time? I have met a lot of great agents that are consumate professionals, but not all agent are great. Clients should be cautious when it comes to sharing too much financial information. 
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January 28 2013
Don't worry at all, his is 100% standard procedure and vital to ensure a successful closing.. Finding a home and getting your offer accepted is only the first half of a real estate acquisition. After this point it is the job of the real estate broker to make sure the transaction is conducted smoothly by communicating important information between you the buyer, the seller, the mortgage broker, title and escrow. Everyone needs copies of the purchase and sale agreement, title and escrow numbers, legal description and disclosures, the mortgage broker will also need all of the property information, and access to the subject property for appraisal purposes. In addition to that your real estate broker can stay on top of your mortgage person to make sure the file gets through in a timely manner and doesn't end up hanging out on someone's desk for a week or two. Remember your real estate broker has a fiduciary, responsibility to you the client so they are always looking out for you to get the best deal!
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January 28 2013
Profile picture for sunnyview
Totally agree with you John and I apologise for not reading more carefully the first time. Thumbs to you for clarifying.
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January 28 2013
Sunnyview, the entire quote is:

"First of all the loan officer isn't going to share any personal information with your broker.  If they do, you need another loan officer. SoCAl is right;  personal information, beyond "do you quality for the loan?"  shouldn't be shared by the loan officer."

I'm assuming that you agree with that.
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January 27 2013
Profile picture for sunnyview
"First of all the loan officer isn't going to share any personal information with your broker."

I would not count on that. Lenders and agents exchange all types of information when they talk. I would give my agent the approval letter, but would not authorize the lender to talk to them about anything but limited and escrow specific information. 

For example, your top qualification amount is your business. The amount you could spend if you used a different loan product is also your business. You can easily keep your agent informed without compromising your financial privacy or allowing them the snuggle up to your lender.

Weigh the risks and benefits, but understand that communication between the two professionals may leave you as the odd man out when it comes to doing everything to close the deal whether that is best for you or not.
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January 27 2013
Profile picture for user3719773
Thank you all for your very informative answers! When we bought our current home.10 years ago, it was a very different process!
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January 27 2013
Your agent has the responsibility to see that you stay in contract.  That your loan application is made in accordance with the terms and timeline you put in your offer, and also that your loan officer is provided copies of an extension of inspection or closing dates, as well as any concessions or change in purchase price due to negotiations arising from the home inspection.  I have had situations where the loan officer forgot to order the appraisal, and had I not been tracking things, the closing surely would have been delayed.  Generally, agents want to give good service to their clients, and helping however they can to make the loan process smoother, is an aspect of that.

In the current market, there is often a moment in the transaction where buyers are frustrated with how long underwriting is taking, and fear that they may never get to the finish line of the transaction.  Your agent will be there to advocate for you, and also to reassure you.

Trust me, as agents we aren't interested in your confidential information, net worth, credit history.  Qualified with an effective loan officer is good enough for us.  But we can be most helpful if we have your trust and have leeway to do our best work for you.

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January 27 2013
First of all the loan officer isn't going to share any personal information with your broker.  If they do you need another loan officer. SoCAl is right;  personal information, beyond "do you quality for the loan?"  shouldn't be shared by the loan officer.
Underwriters have gotten very picky about the properties that they loan money on and any misguided comment on an inspection form can easily deny a loan. Unless your broker and the loan officer are able to discuss these terms before submitting the response to the inspection, you may not get a loan.
Sellers are also moving into a position where they want to know how well the loan process is going to go. If the Buyer's agent can't vouch for the lender, it gives a reason for a seller to take another offer. If you have included a financing contingency there is no requirement for the seller to accept the offer. Not you case here, but SoCal is looking for a broader understanding.
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January 27 2013
As a Broker and sales manager of 60+ agents, I have seen many examples regarding your concerns.

As a buyer, its important that you choose a real estate agent that will represent you to the end.  Not just an agent to write an offer then go away...waiting for their commission check to arrive in the mail.

Here is what I know and I hope it helps.

When I represent a client as a buyer, I require that they get a pre-approval from their lender prior to us submitting an offer because in a competitive market, the selling agent will require this.  This letter will also have the lenders information on it for both agent to identify.  

Keep in mind the lender will need the agents information as well, as we are all on the same team...to get you into your home as quickly and with the least amount of delays.

believe it or not, many lenders that represent our buyers are not the best a sticking to a schedule and its your agents job to help you by communicating for updates to help keep everyone on time.  If the sale was due to close and the two never communicated...who's fault would it be if it did not close on time?  The buyer simply wants the home.  

I have cases where the appraisal should have been ordered weeks ago and the lender forgot this simple task.  The lender is responsible for ordering the appraisal, the appraiser (most of the time) will contact the buyer or selling agent for access to the property...Some lenders may not be 100% honest with all the facts and at the 12th hour the agent finds out that the buyer is still waiting for a credit issue to be cleared...if the agent knew in advance there could have been a time extension filed, saving the buyer much grief.  Deals have been lost because of poor communication between lender and agent because of this.

My opinion is let your agent do his job and cooperate with him...it's only to help you close your sale on your new home.

Your lender is not allowed to give them any financial information about you without your permission, so basic communication is harmless.

Best of luck.

Scott Cary-Broker
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January 27 2013
Most lenders, if not contacted by the real estate agent, will contact them. There is a lot of communication required to close a deal. Agent to lender is one of them. Take that out of the equation, and that's a recipe for a failed transaction - for some of the reasons already stated. If your lender is a good one, they'll want that interaction. If they don't, I'd steer clear of them. I had one where one of the documents being faxed by the buyer to the lender was too light to read. I only found that out after I contacted the lender. I was able to work with the document to make it readable and we finally closed - after wasting a week! All it takes is 1 hiccup to jepordize a settlement date.
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January 27 2013

Real Estate Agent is the transaction coordinator and needs access to all parties to the transaction to ensure everyone is ontrack to close.

There are a 100 reasons a transaction can fail, and in order to get paid, we need to make sure everyone is doing their job.

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January 27 2013
Personally, if I did not have access to the loan officer of my client, I feel I would be doing them a great disservice. I have to know where the loan is at, and what the lender is doing to make sure the loan closes on time and my client gets into the home when they expect. I had one client who wanted to use his friend (which I did not have a problem with), but two weeks before it was to close, and with Christmas and New years, found out that his office couldn't do it. I turned it over to one of my lenders, and we got it done in time, but had I not been in contact with his lender, who knows when I would have found out. I do not discuss credit scores or personal information, just want to make sure my client can close on time like they want.
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January 27 2013
Well it is mostly to make sure that everything is moving along ok with the loan. Nowadays lenders ask for many documents and some of them can be supplied by the agents, like for instance information on the financial situation of a condo association or management company. In general agents can help speed up the lending process. In New Jersey an agent represents the client and she/he is ethically bound to protect the client interest or risking loosing the licence, so I seriously doubt the agent asked for the lender information for dubious reasons. However just for your peace of mind I would suggest asking the agent directly for an explanation.
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January 27 2013
It is probably mostly for transactional purposes and nothing more than that.

I actively communicate with my buyers' lenders in order to facilitate the loan/sale process.  In many situations, I will provide the loan officer with vital paperwork or explanation on certain things.  In fact, the Agreement of Sale in Pennsylvania even states that agents will communicate directly with the lenders in order to keep things moving the right direction.

Unless you have a reason to distrust your agent, I'm relatively confident that there isn't anything sinister going on.
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January 27 2013
Profile picture for SoCal_Engr

To my knowledge...nothing. It'll be interesting to see what the RE pros have to say. Personally, the only thing the REA needs to know is that I am qualified for the dollar amount I am offering.

It will also be interesting to see lenders' responses.

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January 27 2013
 
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