Home Buying in Sacramento>Question Details

Cheri Nelson, Home Buyer in Sacramento, CA

Communication between the realtor and the lender...

Asked by Cheri Nelson, Sacramento, CA Thu May 24, 2012

We are going to be buying a house soon. I thought it was weird that the lender and realtor communicate. I didn’t know that. Can someone explain what is discussed between the realtor and the lender?

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They need to coordinate getting your best loan that fits your home purchase terms and conditions.
0 votes Thank Flag Link Tue Aug 5, 2014
There is a lot of coordination between the lender and the Realtor. If you are the buyer, your agent may discuss different lending options with the lender to make sure that the most competitive loan is considered. They also need to talk before writing an offer so that the agent allocates enough time for the lender to do their job. There is no point in writing an offer with a 30 day close of escrow, only to find out, that the lender needs 45 days.

The Realtor and the lender will also communicate to make sure key deadlines are met. To discuss any issues that may need to be addressed to ensure the appraisal comes in properly. Some examples may be providing the appraiser with information to show that having a water source from a natural spring is not unusual for an area. The agent and the lender usually coordinate getting the appraiser into the home.

The lender is also helpful in explaining any issues that may delay the closing of the transaction so that the agent can address those issues with an extension or a discussion with the other agent.

Communication between your lender and your Realtor shows that they are working as a team to make sure your home purchase happens with as little difficulty as possible. It's a good sign.
0 votes Thank Flag Link Sun Aug 3, 2014
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0 votes Thank Flag Link Mon Feb 3, 2014
typically, a realtor will communicate the buyer's name and what he/she is looking at and that the realtor has referred the buyer to the lender; the realtor may provide some other generic information, but it is against the law for lender and realtor to discuss details of the borrower's credit (as an example)
0 votes Thank Flag Link Mon Jan 27, 2014
When a buyer finds a piece of rare land, you get a *referred* realtor by another in the same office........then, before you can even get a pre-approval letter in hand, you cannot know how much of a house to build , because the cost of land must be calculated in your mind to search a proper type of house and contractor.
I'm very suspicious of any realtor you have NOT even known a week without even so much as asking you if they can be your realtor, approaching a *possible* lender.
That is waaay too weird.
I can see now how buyers are suspicious because once the realtor said to me,"Oh, you have to PAY for the house, you know." I thought, "Oh how did you ever think I wouldn't pay for it?"
You have to see our side ,too. Too many nosey realtors want another client to grab the land first, not you . They didn't sign any contract with me yet!
Very suspect. Got 5 families looking? Call all 5 and start getting 5 competing for the land, that is how.
Flag Thu Nov 27, 2014
Thanks! I was wondering............ I hadn't even signed any agreement with a realtor who was referred to me , never met and it's only a piece of land without anything on it yet./ Con. to Perm
Since I haven't even gotten the pre-approval yet, how can a realtor in that case want to talk to your 'lender' who is the USDA?
If the I have no idea YET for the TOTAL pkg. I can borrow, including what may or may NOT be accepted as an offer on the land the seller has had on the market for 3 years........... then how inappropriate the 'stranger' realtor (across the country) called FHA/EEM lender and speak for 2 hours?
I can see a link now between how bidding wars start. That smacks of " Well, if THEY , who are dirt poor , can get the loan for construction to perm. let me call Joe and Susie so they can get their application in right away because I spoke to them and they are friends of mine -because I didn't ever hear of that kind of loan or mortgage before!"
That isn't ethical +jumping the gun.
Flag Thu Nov 27, 2014
I went to Real Estate to see if he can help get a loan, and he said we have good credit no problem, I waited 2 month no answer. His sent me a appriser to value my home, i have no loan on home it is payed off. We need to get a loan to pay a HELOC from a previous marriage..we had a set time to pay off the HELOC per court order,,he wasted my time and was working with other party to help sale my home...now my time has ran out ????????????now what can i sue that real estate since he is a sales man not lender. for damages. and for the apprisel(535.00) that i lost?
0 votes Thank Flag Link Wed Jul 10, 2013
Dear Cheri,

No not at all, in fact it's essential to the transaction that the agent is informed about the progress of the loan. That's basically what we want to know..because that is what the seller and the listing agent are very concerned about as well. This way we can assure the seller, that all is moving along and the property will close escrow.
0 votes Thank Flag Link Sun May 27, 2012
As I lender, I will take the lender piece.

Your lender pre-approves you for financing. Your realtor needs to all the caveats of how your financing is structured in order to write an offer that WILL GET ACCEPTED! In this market having the two work as one team is so so beneficial to you Cheri as a buyer. This is normal and should be expected.

Here is an example:

Let's say you have a 681Fico and are a first time home buyer. Let assume you are not a veteran and not buying rural so FHA is probably your best bet.

Normally I would offer say 3.75% (4.812% APR) on a 30-year fixed FHA and have around a 1.75% lender credit. On a $200,000 loan for example the lender credit amount to $3,500 which is credited toward your closing costs. On a typical $200,000 loan for recurring and non-recurring closing costs, your total closing costs will be somewhere in the area of about $5,000 (appraisal, loan processing, escrow, title, your homeowner's insurance, impound for your property taxes, etc.).

In this case that leaves you short by $1,500 for closing. Now assume you don't have $1,500 but you do have enough for your down payment.

What should I tell the realtor?

I would have her write the offer with your 3.5% down payment and ask the seller for a $1,500 closing cost credit. Done in this fashion, you come in with your minimum down payment and are good to go.

Communication is key. Also it is important for the realtor and lender to have worked together, in my humble opine, because both will know how the other works and the style of how the closing will go.

You are probably in good hands!
0 votes Thank Flag Link Sat May 26, 2012
Great detailed explanation!
Flag Sat May 26, 2012
You need a strong team behind you to successfully buy a home and two of your key participants are your lender and your realtor. Your lender shares only pertinent information regarding what a realtor may need to know about your affordable price, terms of any loan that you might consider and should be reflected in the offer and things like that. They don't share your financials, if that's your concern.

Just because a lender hands you a prequalification letter doesn't mean that your clear to go on ANY offer. There's always details still needed to be understood by the realtor to structure the right offer for you according to your financing circumstances.

I have to tell you that after many years as an investor,I finally was incented to get my own realtors license when my realtor and lender weren't working together. Because of that, I lost my earnest money deposit, (being the one responsible to execute the contract between me and the seller). It is CRITICAL to have a lender and realtor who communicate, not only with you, but with each other, to make your transaction happen smoothly.
0 votes Thank Flag Link Fri May 25, 2012
The realtors like to make sure everything is in line regarding the pre-approval, as well as to see if any specific details need to be addressed such as property condition (depending on your down payment and loan type), closing cost credits, and such.
0 votes Thank Flag Link Thu May 24, 2012
Actually, it's necessary and desirable for the two to communicate! They are on the same team - YOURS.

Your Realtor needs to understand the type of loan you are getting, the amount of down payment and any restrictions in order to find you an appropriate home. Your lender will perform best when he or she is kept in the loop of your home buying process and when to provide you with information about your loan.
0 votes Thank Flag Link Thu May 24, 2012
Hi Cheri. That is a great question. When we work with buyers, finding the right house is just 1 element to the equation. Before we spend time showing properties, we must ensure that the buyers are qualified to purchase the homes that we show. When we write up offers, we need to know what the financing terms are as we have to include information about the financing in the offer. It is important that we have a solid understanding of the financial qualifications of the buyer and we need to determine that by talking to the buyer's loan agent. It's important that we don't write up an offer that includes terms that the buyer's loan agent can't meet and we need to know the strength and weaknesses before we write up an offer. You would not want to get an offer accepted just to find out that you won't be able to perform because of a loan issue that your agent did not know about. You, your real estate agent and loan agent should work as a team, not separate entities, to have a successful transaction. I hope this helps.

Good luck with your purchase.

Ute Ferdig
0 votes Thank Flag Link Thu May 24, 2012
Hi Sue. Thanks for the compliments. I just noticed the comment section. Have never seen it before. Oops.
Flag Sat May 26, 2012
Good job Ute! Well said.
Flag Fri May 25, 2012
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
I assume you are talking about your lender and your real estate agent. Of course we talk, very important to make sure everyone is on the same page and that the transaction is moving along in the contract time frame.
Prior to writing an offer the agent needs to know what the terms of the loan will be so it can be put in the contract correctly, also how long the lender needs to arrange appraisal, do underwriting and close escrow, so that the dates put in the contract are doable. The lender needs to know the particulars of the property to write up the pre-approval letter that is usually required with the offer submission.

As the escrow progresses all parties need to know what is expected of them, and if any additional paperwork or repairs need to be done prior to loan approval, so communication is very, very important.

You should also be communicating with both your lender and agent to make sure you are on track. You may want to discuss with your agent and lender their expectations of you. For example your lender should tell you not to go out and make any big purchases before closing, also to make sure your deposit funds are seasoned, your agent will want to know what inspections you are having and when.

You are all on the same team working towards the same goal for you.
0 votes Thank Flag Link Thu May 24, 2012
We talk about how we get all of your money out of your pocket and into our pockets. JUST KIDDING!!! The lender does not share your personal information and wouldn't share any money they get with us anyway. It is against RESPA violations to pay fees to a mortgage broker or vice versa.

Generally we talk about your maximum loan limits and how much to put on the pre-approval letter. You don't want to make an offer on a property worth $200,000, for example and submit a pr- approval letter that says you can afford to pay $210,000 when you are offering $195,000. Otherwise, a seller might want you to pay list price.

After you are in contract, we communicate about the progress and your documents. For example, the lender will want a copy of the TDS, which we supply. There might be funding conditions about the property that we will need to resolve prior to closing. We might need to draw an addendum for the lender to remove or add an element to the purchase contract. We generally both attend closings.

Elizabeth Weintraub
Broker-Associate #00697006
Lyon Real Estate
0 votes Thank Flag Link Thu May 24, 2012
Then lender and Realtor need to talk on a regular basis whether they knew each other in the first place. Your Realtor needs to make sure the lender has everything they need and adheres to the CAR purchase agreement. They have to work as a team for you to make sure everything goes smoothly and you close on time. There is may aspects of a real estate transaction that most people don't realize. When you have a good agent and lender you shouldn't know all the problems that accure because they are just handled without worrying you.
0 votes Thank Flag Link Thu May 24, 2012
Hi Cheri,

First let me ask what about their communication do you find strange? Did you have any input in the selection of your lender?

Keisha Mathews, REALTOR®
CDPE®, HRC®, HAFA® Certified
The Short Sale Lady(sm)
Century 21 Landmark Network
(916) 370-1803
(916) 405-3886
lic#: 01439130
0 votes Thank Flag Link Thu May 24, 2012
I forgot a few things...there are lots of loan programs out there, and sometimes certain properties work with certain loan programs and others don't. So during the home viewing and contract writing phase, it is VERY important that the Realtor and Lender are communicating to make sure that the contract is written correctly and that you have the best chance of being able to purchase the home that you are writing a contract on.
0 votes Thank Flag Link Thu May 24, 2012
In an ideal situation your Realtor, Lender, and Escrow Officer work together as a team to facilitate the purchase of your new home. Like Don mentioned, the lender often has questions about the home, needs paperwork, or needs to arrange the appraisal, and it's easiest to have the Realtor arrange this. I've had escrows before where the lender wasn't in good communication with me, and things went rough. I actually recommend hiring professionals that have worked together before. So, ask your Realtor and/or lender if they have worked with the other before. If they have and it worked out well, then you've got a solid team helping you purchase your home.

Happy house hunting!
0 votes Thank Flag Link Thu May 24, 2012
Why weird?

There's a lot of information the lender needs. Much of it should have been supplied on your purchase agreement, and much of it should have been supplied by the paperwork/application you filled out. But there are always lots of loose ends and other questions that have to be resolved. The ones that related to you will come to you. But, for instance, the lender needs to send an appraiser out to the property. That's best coordinated with the Realtor. It saves you time and effort. Or there may be other things--HOA documents, or condo documents, or documents addressing easements--that need to go to the underwriter. Some of those originally came from the seller . . . but the seller has no relationship with YOUR lender, so the lender is going to be looking to you and your agent to provide that information.

To overgeneralize slightly, any questions the lender has about the property itself--the structure, the legal entity, and so on--is going to come to you. Your Realtor is providing that information to expedite the process, to save you time and hassle, as part of his/her services.

Hope that helps.
0 votes Thank Flag Link Thu May 24, 2012
Don Tepper, Real Estate Pro in Fairfax, VA
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