Home Buying in Chicago>Question Details

slishmov, Home Buyer in Chicago, IL

I recently made an offer on a home with a pre-approval from a lender.

Asked by slishmov, Chicago, IL Sat Dec 22, 2012

I recently made an offer on a home with a pre-approval from a lender. The sellers agent actually called my lender before countering the offer and asked the lender to pre-approve me a different terms. Is that legal?

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Answers

10
Annette Lawrence’s answer
There are many situations that would make such action acceptable.
Often, as others have indicated, it is to verify the pre-approval status (has ANY information been confirmed) and if the company on the letter head really exists.
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It is highly unlikely the agent requested the TERMS to be changed.
That simply can not, and did not, happen.
As the text below explores, the question "Can the limit be raised to ???" could have been asked. However, the lender, your broker, CAN NOT DISCLOSE THIS without consent.
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Let's pretend you are attempting to purchase a short sale. The listing agent advised regarding the following:
1. The listed price is $150K and that is a very attractive price.
2. Trulia states community average value are $220K
3. Comps show values at $180k
4. The appraisal will come in at $167K.

It is very likely the bank will counter at a value near, but like slightly below $167K.
I would say, "Dear buyer, are you able, should the bank counter at $167K, to raise your offer from $150K to $167k?"
If you say no, your offer is rejected completely.
If you say yes, I work hard to get the home at $150K, but it's still a great deal of $167K and you must be willing and ABLE to complete the deal. And, dear buyer, I will verify this ability.
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Of course i MUST confirm via your lender that you are qualified at $167K. Additional information such as does the lender have in-house underwriting and assessing their 'track record' of meeting closing dates and gaming appraisals are all IMPORTANT and could prove detrimental to your situation and result in a No Sale six months later or kicked to the curb today.
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If you are unable to increase if necessary, your offer is rejected.
If unable to allow me the opportunity to confirm, your offer is rejected.
Note, the scenario above is regarding a short sale.

If this makes a buyer uncomfortable, a short sale may not be a good choice.

Best of success to you.
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
727.420.4041
http://RealEstateMadeEZ.us
1 vote Thank Flag Link Sun Dec 23, 2012
There are two questions here:

1. Whether the seller's agent wrongfully interferred with your contractual relationship.

2. Whether you suffered damages.

More information is needed to answer your question, and now you know the direction to steer your inquiry.
1 vote Thank Flag Link Sun Dec 23, 2012
sounds like your looking for legal advice that can be found at James Schultz 773 680 7426
0 votes Thank Flag Link Sun Dec 23, 2012
Yes, for example if the property will not pass an FHA financing scenario then he would ask your mortgage broker ro qualify you for a conventional loan.



Sohail A. Salahuddin | Founder
IPC Group | Sales and Leasing | Residential and Commercial
Jameson Sotheby's International Realty
425 W. North Ave
Chicago, Il 60610
312.437.7799 | cell
312.335.3235 | office
847.805.6030 | fax
sohail@jamesonsir.com



Search all available properties here:
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0 votes Thank Flag Link Sun Dec 23, 2012
I agree the sellers agent can verify the pre-approval. What they can't do, in my opinion, is to ask the lender if they would be pre-approved at different terms such as a higher price. And if your lender answers that question find a new lender.
0 votes Thank Flag Link Sun Dec 23, 2012
When you submitted the offer with the pre approval letter from a lender, you are telling the seller that you are serious about these property. The seller's agent have the right to call the lender to verify that you are pre approved and what are the conditions of the loan, as well as to check if he/she actually saw your financial statements that make you qualify for the loan amount.

Best of Luck,

Maria Cipollone

Century 21 Tenace

http://www.Flahomespecialist.com
0 votes Thank Flag Link Sun Dec 23, 2012
The other agent can ask whatever they want to. Your lender should ask you if it is ok to do it, but nothing illegal about it. Sounds like the other side does not like your pre approval. Ask you agent to find out why.
0 votes Thank Flag Link Sun Dec 23, 2012
Could not agree more! Your financial information is private. Along with that Jody said it well, that Real Estate agent AND your lender should have known better.
0 votes Thank Flag Link Sat Dec 22, 2012
I agree. Your lender should never discuss your preapproval with the sellers agent and especially if they are using it to gain information that can be used in their counter offer strategy. If your lender gave them info about your ability to get approved at a higher offer level I would dump your lender and find someone that you can trust
0 votes Thank Flag Link Sat Dec 22, 2012
Hi Shanna,

I understand that. The lender did not discuss any information. Is it appropriate for the Sellers Agent to ask the lender for a new approval with different terms not agreed upon?
Flag Sat Dec 22, 2012
Hi slishmov,

Your lender should not discuss any of your financial information with anyone except the people you have given them written authorization to do so. If they did, I would recommend changing lenders as they are violating your privacy rights.


Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes Thank Flag Link Sat Dec 22, 2012
Hi Shanna,

I understand that. The lender did not discuss any information. Is it appropriate for the Sellers Agent to ask the lender for a new approval with different terms not agreed upon?
Flag Sat Dec 22, 2012
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