Have your buyers agent represent you in this matter.

Many builders have their own lender also an incentive for buyers, however in some instances not the better option you are CORRECT BRAVO for you STOP compare you could be over paying.

Builder should be happy have a qualified buyer ;) you are rare for current market.

GOOD LUCK

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Lynn911

Hopefully, you have your own agent--and not one who already has an established relationship with that builder.

Have him/her to submit an offer on the state approved contract, and don't sign anything from the builder that attempts to coerce you into going with its lender. As a compromise, also have him/her to submit some notes with your offer indicating that you'd be willing to buy the property subject to the underlying financing with the builder's preferred lender provided the builder carried a note at 6% APR, amortized for 30 years, for at least 95% of LTV with a 5-year balloon.

If the builder counters, then have your agent counter again with the same offer.

I think there are more details here that we are not getting. Does your deposit count towards closing costs or anything? Is it non-refundable only if you back out?

The non-refundable deposit is common when purchasing new construction, but it's usually a credit toward your closing costs in the end. They are just telling you up front that if you cancel the deal there is no way you are getting your $2K back. This sounds like a way for them to force you to use their lender. Usually seller paid closing costs are tied to the use of the builders lender to encourage you to use them. It's not a bad deal as long as their rates are competitive. You should have some incentive to use their lender.

If you are not getting any incentive then you should not be penalized for not using the builders lender. If I were your agent I would look in to this and probably reduce the sales price to compensate. Otherwise it sounds like you are paying the builder an extra $2K for nothing if your deposit is not being credited to you in some other way at closing.

Same mindset here, Cg, as Hank's. In this market for townhomes, with the right selling agent, you can negotiate anything from a position of strength. Would really like to hear what your agent suggests.

That sounds shaky at best as you can't force a buyer to use a particular lender. That said, you can twist them pretty hard -

One common way is for a builder with a mortgage company arm to offer a home for 100,000....you come in and are told that if your use their mortgage lender you will receive a "discount" of say 10% either through discounts on upgrades or closing costs.. This is an incentive for you to use their lender and buy the home. Bottom line is that you'll likely pay a bit higher rate and the costs will be buried in the loan somewhere. You see the lower initial cost and as long as they compete rate-wise (most will be a bit over than market) most take the deal.

Builders without mortgage arms may have an affiliate. These can work the same way but many are used to validate your credibility; essentially to ensure you're legitimate. You lose nothing by entertaining their rates but I would never suggest paying a dime for that.

Now, that 2K deposit may be nonrefundable if you don't qualify - and that's not all that unusual in this market. It may be a case of if you use your own lender and the deal falls apart you've lost it - use theirs and they'll some how get it done.

What's you buyer's agent telling you?

Hank