Home Buying in Atlanta>Question Details

atl404, Home Buyer in Atlanta, GA

LENDING REQUIREMENTS- PLEASE HELP ASAP! I HAVE A CONTRACT ON A SHORT SALE. MY LOAN OFFICER HAS RECEIVED APPROVAL BACK FROM UNDERWRITER FOR THE LOAN.

Asked by atl404, Atlanta, GA Tue Sep 24, 2013

THE AGENT LISTING HOUSE REQUESTED A PRE-QUAL BE DONE WITH HER FRIEND , AS A EXTRA LAYER OF SERCURITY, WHICH I DID. I TOLD BOTH AGENT & HER "BUDDY" TH,AT I HAD MY FINANCING LENDER IN PLACE ALREADY, AS I USE OVER THE YRS. WE SENT THE APPROVAL OVER TO LISTING AGENT FROM UNDERWRITER & SHE "AGENT" IS THREATENING ME "BUYER" TO CANCEL CONTRACT, IF I DONT USE HER "BUDDY" TO DO THE LOAN. THE LOAN HAS ALREADY BEEN APPROVED & UNDERWRITTEN.. WHAT RIGHTS DO I HAVE AS A BUYER?

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You have the right to chose your own lender, the seller can require that you are at least pre-approved by one of their preferred lenders but that is all. If what you are saying is 100% accurate then this is 'steering" and it is illegal. Are you working with your own agent? They should be getting involved and not allowing this to happen. If you do not have an agent, you might want to find one ASAP! The selling agent may just think your an easy mark b/c you're representing yourself.

Sincerely,

Chris Irvin
Mortgage Consultant
Brand Mortgage
NMLS # 75615/465546
678-251-7889
cirvin@brandmortgage.com
http://www.chrisirvin.com
2 votes Thank Flag Link Tue Sep 24, 2013
You have the right to use any lender you choose, I am shocked an agent would require you to use her friend, sounds like a RESPA violation to me. Her buddy may be able to get the loan done easier than another Lender, or she may get referrals from the friend. Does not mean that loan will be the best fit or the beat deal for you. Use any Lender you want to the agent has no say in that.
1 vote Thank Flag Link Fri Oct 4, 2013
When a mortgage is being obtained, it is a RESPA violation to require the use of any settlement service provider as a condition of the sale. While the seller can require a Pre-Qualification from a specific mortgage company, that is where is stops.

Also, you should not be communicating directly with the Listing Agent. You need to allow your Buyer's Agent to do their job.

Regards,
Rodney Mason, NMLS #151088
Sr Loan Officer
Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
rodney.mason@prospectmtg.com
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia with over a decade of mortgage lending experience.

Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203(k) Renovation (Streamline & Consultant) | HomePath® | HomePath® Renovation | HomeStyle® Renovation | VA | USDA | GA Dream | Jumbo Financing.
1 vote Thank Flag Link Tue Sep 24, 2013
Amazing how these "situations" arise.

There is no extra layer of security - use whatever lender you want as it is your option. If the agent decides to act unethically, call her broker and the GA real estate commission and report her

http://www.grec.state.ga.us/about/contactus.html
Web Reference: http://www.hmtatlanta.com
1 vote Thank Flag Link Tue Sep 24, 2013
This is absolutely unethical. I recommend contacting the Listing Agent' Broker directly to rectify the situation. It is not a requirement for you to use the Listing Agent's Friend/Lender. It is simply a preference. You may also consider consulting with an Attorney.
1 vote Thank Flag Link Tue Sep 24, 2013
You don't have to close your loan with her lender. It's not written in the special stipulations part of the contract is it? Do you have buyer's representation? If not, you can contact the agent's broker directly and explain the situation. If you do, your agent should be handling this for you.

Best Wishes.

Jen and Mark Bowman
Keller Williams Realty
941-840-0117
1 vote Thank Flag Link Tue Sep 24, 2013
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0 votes Thank Flag Link Sat Nov 30, 2013
As a buyer, you have the right to choose who you will use to finance your loan. I have seen many situations where the seller, whether it be an individual or bank, requests that the potential buyer receive a pre-qualification from the sellers preferred lender. This is done as an extra level of security as you have mentioned. If the seller or listing agent has concerns about whether your chosen lender will be able close that transaction, they should communicate this to you and not try to force you to a lender that you have not chosen. Have your agent speak with the listing agent. Hopefully they can work this out so that it will be a win-win for everybody. Hope that helps.

LaShonda Solomon
Associate Broker
Keller Williams Realty Signature Partners
(678) 477-5226
LaShondaSolomon@kw.com
http://www.AtlantasPremierProperties.com
0 votes Thank Flag Link Tue Sep 24, 2013
Do you have a binding contract or an offer in place? If you have a contract, seller can't "cancel" it, unless you (buyer) are in default. Have you agreed in writing (in the contract) that you will use a specific lender and only that lender? If you haven't, you shouldn't have an issue. The only rule that applies to your financing contingency (if you have one) is if you are changing lenders, you must notify the seller.
I hope you have an agent who represents you...
0 votes Thank Flag Link Tue Sep 24, 2013
I wouldn't even try to answer the legal question, I think it would depend on what was agreed to in the contract. Over the years I've seen situations where there were inducements such as closing paid cost when using the preferred lender, and have heard of various tactics used by sellers and their agents to exercise controlsually due to a poor experience in which the loan fell apart apart just before closing, which could cause the seller to miss a viable buyer with the property off the market. Ultimately the agent and the seller want the loan to close.

From what you describe, it does seem unprofessional on the part of the agent. The agent doesnt have the authority or ability to cancel the contract as the contract is between you and the seller. If it were me, I would stand firm. The agent is not allowed to steer you to a particular lender.

I hope this helps.
Nick Nicholas
SunTrust Mortgage
NMLS 658973
678-614-4327
0 votes Thank Flag Link Tue Sep 24, 2013
You have gotten good advice on how to remedy the situation she cannot do that. you have a right to choose any on do you want and you can indeed file a complaint against her.
0 votes Thank Flag Link Tue Sep 24, 2013
It is not illegal to request a pre-qualification letter from a specific lender but is illegal in most if not nearly all states to demand a buyer use a specific lender to get their mortgage. Your buyer agent should be helping you. If you did not use one, then you will need to file a complaint with the listing agents broker and try your states real estate commission.
0 votes Thank Flag Link Tue Sep 24, 2013
While it is not illegal or unethical to require you to go through the pre-qualification or pre-approval process with a preferred lender, I don't beleive they can actually compel or require you to use that lender. That seems very shady.

I understand requiring this extra layer of security. Realtors are dealing with a lot of supply and demand issues and are encountering multiple offers. If their preferred lender approves someone then they presumably know they are dealing with a well qualified borrower. If they don't know your lender from Adam then they may consider your approval less firm. Having you speak to "their guy" can give them the confidence that if your lender drops the ball, the deal could still be saved without starting at square one. That is the the thinking behind that.

With that being said, once you have complied with the pre-qual request you should be in the clear.

Just to clarify, are you saying that you actually have an offer accepted by the seller and the seller's lender? Or have you merely submitted the purchase offer and the agent relayed that you must go through the process before your offer can be accepted?? The stage at which you are at in that process could impact whether they are operating on the side of the law or not. Legally, a seller and/or the bank approving the short sale can approve or deny an offer for any reason they like (including requiring you to become pre-approved through their preferred lender). Once it is accepted in writing though, they cannot really add any stipulations. So it may be a case where they are operating within the law, although I wouldnt consider this ethical.

In either case, your Realtor should be advising you on this. And if you made the mistake of not having one, you should get some legal representation to help you sort this out.

Best of luck!
0 votes Thank Flag Link Tue Sep 24, 2013
Buyer cannot cancel the contract unless there was some kind of special stipulation requiring the use of their lender. You can get your mortgage wherever you want to. I would report her to the Georgia Real Estate Commission. Is the listing agent a Realtor? Also report her to her realty board - code of ethics violation.
0 votes Thank Flag Link Tue Sep 24, 2013
First, do you have an agent representing you in the transaction. If so, you need to discuss this with him or her. If he/she can't help, involve his/her broker.
If you don't have an agent representing you, this is a good example of why you should have one in the future. Buyer agents don't cost a buyer anything since the commission is almost always paid by the seller.
Assuming you do not have an agent, we would need to see your contract before we can tell you whether or not the agent can do this. If you have a finance contingency, it often specifies the lenders you can choose from. If only her "buddy" is listed, then you have agreed to inform the listing broker if you have chosen a different lender and provide their contact information. Since it appears that you have done that, you are free to use the alternate lender.
You should have all the legal recourse that the law provides if the seller fails to live up to the terms of the contract.
If the listing agent attempts to void the contract without a valid cause, I would recommend that you contact the agent's broker (which will likely resolve the problem), but if you do not receive satisfaction, contact an attorney asap.
0 votes Thank Flag Link Tue Sep 24, 2013
THANKS FOR ALL THE REPLIES. AND YES, SHE TOLD ME SHE "AGENT" WOULD NOT ACCEPT MY OFFER UNLESS I DID A PRE-QUAIL WITH HER "BUDDY" AFTER I TOLD BOTH OF THEM I HAD MY OWN FINANCING IN PLACE. IT IS NOT WRITTEN IN CONTRACT THAT MUST GO TO HIM FOR FINANCING. THIS IS VERY UNETHICAL...
0 votes Thank Flag Link Tue Sep 24, 2013
If you have a buyer's agent, discuss the matter with your agent and his/her broker. If you don't have an agent representing you, contact the listing agent's broker to discuss the matter. If that doesn't resolve the issue, discuss with an attorney who specializes in real estate law.
0 votes Thank Flag Link Tue Sep 24, 2013
SHE CANNOT DO THAT. (And for the record- next time, it is easier for us to read things when it is not all capitalized.... at any rate call your attorney- or call one if you dont have one... and discuss this with them)
0 votes Thank Flag Link Tue Sep 24, 2013
I AGREE...LOL (Upper and Lower Case Please)
Flag Tue Sep 24, 2013
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