More questions from you! Good for you, this is an excellent way to get good quality answers. And the answers to your questions have pretty much been summed up here already but I will throw my two cents in as well.

Are the Pre-approval letter and Good Faith Estimate required to go along with the offer?

Yes. Especially both if the buyer is looking for seller assistance towards buyer closing costs. And yes, as a listing agent I always call that financial institution to verify facts and I also go over the details of those numbers disclosed on behalf of my seller clients. That's my duty to them.

If however I work for the buyer, there are circumstances where my buyer does not wish to have their financial details openly discussed and that arrangement is usually made through your bank or financial advisor. A phone call is made or a letter is created verifying only that the buyer's account has sufficient funds to cover this particular transaction and this information is shared only with the listing agent once an offer is going to be made. Not untypical in foreign buyer purchases and also where someone very wealthy wishes to remain private.

I read and responded to your other post, so I see where this next question in coming from. Yes it may seem as if you are being pressured to use an agents choice in lenders and title company but the reality is twofold:

1. Agents in some companies make a profit from what's called ancillary services like mortgage and title. They recommend those services because the fact that they have ownership there means they have a bit more control and can rest knowing the transaction will be handled the right way. There is no doubting as with an outside company, especially in this market where so many events are taking place that can hurt a buyer. (This is usually explained when you are in the buyer consultation process.)
2. Agents do this because they have experience with that lender to know the lender will do their job and in a timely matter. They trust the lender to get them to settlement with all the necessary documents, wire transfers (money), to be prepared, to follow up and professionalism has been demonstrated so they aren't battling how someone else treats their client. They really are trying to help you! But understand that it is your decision and there is no reason to feel pressured. If you do, there may be some spefic reason that you should agree with and understand, otherwise then walk away.

Your third question was about what to ask when interviewing. That book I offered you before about buying your first home? It's all in there. I think you need that book! Contact me once you have read this post, as I said before I'd be happy to get this book in your hands and you will feel much more prepared and educated.

Best wishes!
Irene Butler
Partner / Realtor
Keller Williams RE
276 B Dilworthtown Rd
West Chester, PA 19382
610-399-5100
Cell 484-576-9491
IreneButler@kw.com http://www.IreneButler.com


In the end, it's always my recommendation to speak to several lenders and your personal bank. You chose the one you feel most confident in.

A preapproval letter serves as your "admission ticket" to the homebuying process. It indicates that you have taken the initial steps to qualify for a loan. Furthermore, a Good Faith Estimate provides you a snapshot of the potential costs associated with closing the transaction and subsequent debt service that you'll be undertaking as a new homeowner. As for selecting a banker to finance your purchase, take a moment and shop around to several sources to see what you should expect regarding potential loan products and terms. Select a lender that you feel confident can satisfy the promises that are presented to you during your consultation. Remember that a Realtor provides recommendations based probably on past experience and is just seeking to maintain the integrity of the transaction in your best interests. Having said this, it is ultimately your decision to select the lender.

Simplest answer to selecting a competent agent is to ask those closest to you for referrals. The next suggestion would be to "interview" them and determine which agent provides you a sense of maximum confidence to close the transaction in your best interests. Ask for recommendations to clients that have closed recently as well. Good Hunting!

Only your pre-approval needs to go with the agreement of sale. This allows the seller to know that your credit has been checked and that a bank will lend you the necessary funds to complete the deal. Agents usually do like to talk to the person who wrote these letters to verify the information. Because of the current financial situation many banks and financial institutions have tightened their rules so agents like to know what is the situation and has the mortgage broker/banker done everything that needs to be done.

Agents may not want you to use their friends, but they do want you to use someone who is local, not an internet bank that will sell your loan before settlement even, and who can be contacted and is sure to perform. We usually recommedn three or four local mortgage bankers/brokers who we know will have the funds at settlement.

Here are 12 Questions to Ask When Choosing Your REALTOR®

Make sure you choose a REALTOR® who will provide top-notch service and meet your unique needs.

1. How long have you been in residential real estate sales? Is it your full-time job? While experience is no guarantee of skill, real estate — like many other professions — is mostly learned on the job.

2. What designations do you hold? Designations such as GRI and CRS®, which require that agents take additional, specialized real estate training, are held only by about one-quarter of real estate practitioners.

3. How many homes did you and your real estate brokerage sell last year? By asking this question, you’ll get a good idea of how much experience the practitioner has.

4. How many days did it take you to sell the average home? How did that compare to the overall market? The REALTOR® you interview should have these facts on hand, and be able to present market statistics from the local MLS to provide a comparison.

5. How close to the initial asking prices of the homes you sold were the final sale prices? This is one indication of how skilled the REALTOR® is at pricing homes and marketing to suitable buyers. Of course, other factors also may be at play, including an exceptionally hot or cool real estate market.

6. What types of specific marketing systems and approaches will you use to sell my home? You don’t want someone who’s going to put a For Sale sign in the yard and hope for the best. Look for someone who has aggressive and innovative approaches, and knows how to market your property competitively on the Internet. Buyers today want information fast, so it’s important that your REALTOR® is responsive.

7. Will you represent me exclusively, or will you represent both the buyer and the seller in the transaction? While it’s usually legal to represent both parties in a transaction, it’s important to understand where the practitioner’s obligations lie. Your REALTOR® should explain his or her agency relationship to you and describe the rights of each party.

8. Can you recommend service providers who can help me obtain a mortgage, make home repairs, and help with other things I need done? Because REALTORS® are immersed in the industry, they’re wonderful resources as you seek lenders, home improvement companies, and other home service providers. Practitioners should generally recommend more than one provider and let you know if they have any special relationship with or receive compensation from any of the providers.

9. What type of support and supervision does your brokerage office provide to you? Having resources such as in-house support staff, access to a real estate attorney, and assistance with technology can help an agent sell your home.

10. What’s your business philosophy? While there’s no right answer to this question, the response will help you assess what’s important to the agent and determine how closely the agent’s goals and business emphasis mesh with your own.

11. How will you keep me informed about the progress of my transaction? How frequently? Again, this is not a question with a correct answer, but how you judge the response will reflect your own desires. Do you want updates twice a week or do you prefer not to be bothered unless there’s a hot prospect? Do you prefer phone, e-mail, or a personal visit?

12. Could you please give me the names and phone numbers of your three most recent clients? Ask recent clients if they would work with this REALTOR® again. Find out whether they were pleased with the communication style, follow-up, and work ethic of the REALTOR®.

Not all are relevant when choosing a buyers agent, some work more for a selling agent. Do agents like to answer these, a good agent should not mind, they just might not be prepared.

Good Evening,

I actually just met with a buyer who was interviewing 5 agents for the position of assisting them in securing a home. They had a long list of questions. An agent who doesn't want to take the time to answer your questions may not be the best agent for you. They should always be willing and able to answer the questions you have. That will give you a great comfort level with the agent.

The Pre-approval letter always needs to be with the Agreement of Sale not the GFE. The buyer agent should always be in contact with the mortgage lender and the seller agent will also want to be in touch with them. The mortgage lender, title company and agent all need to work together to be sure everything goes well for the buyer and seller.

I can tell you that I never pressure any buyer to use any one person. I do not recommend a mortgage lender associated with my office. I do in fact have a direct lender who is so good I will recommend her, but again she has no affiliation with my Real Estate office. I know that when buyers use her she delivers what she promises and the settlements take place on time and the money is always at the settlement table.

Good questions to begin with are....Are you a Full-Time Agent? Is this your only career? How many Real Estate Deals have you closed so far this year? How many in the area you are searching for? What hours are you available to show homes? Are you available via email for questions I have? These questions are a good starting point. You want to be sure the agent is experienced in the area you are purchasing, that they are full-time agents so you have their full attention, that they are willing and able to show you properties when you are available and are they available via email and/or phone every day to answer your questions. You will also be able to get an idea of the agent's personality as they answer these questions. Are they enthusiastic about selling Real Estate? Do you feel you can easily communicate with the agent?

Good luck with your search. If I can assist you please feel free to let me know.

Jennifer Daywalt, Realtor
Re/Max Results Realty
Top Agent 2004, 2005, 2006, 2007, 2008
Author of "Ask The Realtor" every Saturday in The Phoenix Newspaper
610-999-7693 Direct
610-489-7355 Main Office
Sellinghomesjenn@aol.com

Awesome questions!
1. Yes a pre-approval letter is required when submitting an offer on a home. A Good Faith Estimate (GFE) is list of all the fees from the mortgage lender. The GFE is not needed when submitting an offer. When you are shopping for mortgages you should get GFEs to compare them as best you can.

It's always good for the Buyer's agent and Mortgage consultant to be in contact with each other to make sure everthing is going smoothly. Agents always recommend the mortgage brokers from their office because they know and trust them and it's very easy to keep them in the loop because they are in the office. I always recommend mine but encourage my Buyers to shop around as well.

2. If a Buyer's agent feels uncomfortable answering your questions then that is the first red flag telling you to move on. You should think about what is important to you in your home search and make sure the agent you choose can give that to you. Ask the agent how they work with buyer's, what is their standard procedure...from that you might discover more questions to ask as well. Ask for experience and references as well and follow through and contact those references.

I am surprised at how rarely I am interviewed as a Buyer's agent. I think most consumers feel all that we do is make appts and drive Buyers around. But yet yourself a bad Buyer's agent and they can make big mistakes in the contract that could make you lose out on a lot!

I enjoy being interviewed like this and look at it like if they don't pick me I need to find out why so I can make myself better to be picked next time.

Best of luck!

Regards,
Krista Fuchs, Realtor
Prudential Fox & Roach Realtors
Exton Home Marketing Center
krista.fuchs@prufoxroach.com

Hello Buyerseller09!

WOW Awesome Questions and I have some resources to help you on my website, so make sure you check it out.

1) Yes the Pre-Approval / PreQualification letter MUST GO with your offer/contract proposal. Yes, the if you have a good Buyer Agent they should have been in contact with your mortgage co before you even started looking at homes. You should have someone who can walk you through the entire process. If the Agent does not contact the Mortgage Co. Then the Mortgage Co should contact your agent...you should make sure you give contact information to both parties. You should be working with a TEAM...if people do not want to work as a TEAM get a NEW TEAM! Agents should not pressure you at all. The reason why you may get referrals from Agents are because they have worked with so many local people they know the best people to work with and you want to work with the best.

2) For this question...go to my Video on my "I didn't know" Page..I gave you the direct link below. I have the insider secrets to interviewing a Buyer Agent! LOL This was so much fun to make. But, hey if someone can not give you answers to these questions...DO NOT WORK WITH THEM!

Wish I covered the Philly area...so I can interview with you. But, Good Luck to you and hope my comments have helped you.

As an agent who works with Buyers and Sellers the practice of verifying all financial details is critical in today's real estate transactions.

1. Yes, when an offer is made on a listing it should be normal practice to call the financial institution who wrote the pre-approval to verify all aspects of the transaction and the quality of the buyer. As for the good faith and pre-approval being required. If the AOS includes a mortgage contingency, then it must be included with the Offer.

2. The main questions to ask may not have to do with real estate transactions at all. You should focus more on asking questions with regard to character and integrity. The best thing you can do is ask to contact previous buyer clients fro references.

I hope these answers help,
Mike Brango

Hello Buyer:

Since a large number of available homes on the market today are "distressed properties" (short sale or REO/foreclosure properties), banks do definitely like to see that a homeowner has approval for financing before approving the purchase of the home. Thus, a preapproval letter or, in some cases, an approval letter from the direct lender is required to be submitted with all offers. Does this mean that the listing agent or the bank confirms that the buyer will have a loan--sometimes yes, sometimes no...it pretty much depends on the circumstance. If the purchase of the home came down to a choice between two buyers, the one that might get the home is the one whose lender tells me that his buyer has great FICOs and will easily qualify for a loan versus the person with borderline FICOs and there will be an admitted uphill battle to get the loan funded. However, in most cases (unless the lender is someone I do not recognize), the listing agent does not contact the loan officer and we do not necessarily need to hear from the officer either.

As for "cooking" the contract by being required to use the agent as the mortgage broker or the agent's recommended pals, we only provide you with resources to make the situation easier. I always provide my clients with several loan agents and tell them that if they know someone at their bank who can make the loan go faster, then exercise that option as well. Sometimes, I recommend only one person because I know this one, for example, is always available and can give me preapproval letters in hours, rather than days. The situation often dictates the recommendation--however, after the home is in transaction, if the owner wants to switch loan companies, they are certainly allowed to do so.

Finally, when interviewing agents, ask him or her all of the questions for which you'll need answers to feel comfortable. The obvious questions are:

1) how long in the business (also full time or part time agent)
2) how many transactions have they done in short sale, REOs, private parties;
3) how many clients are they working with right now--that's a key since, even with a great agent, you don't want to be 27th in a list of active clients;
4) education, affiliations, certifications, specialities;
5) areas where they are most familiar (you may see a pattern regarding where they usually work and the types of homes they are most comfortable selling--see if that meets your goals);
6) Names of satisfied clients with whom you can talk.

If the agent seems unhappy, uncomfortable or reluctant to take or answer such questions, move on. You want a qualified agent to represent you, and most of us are willing (and dying to tell you) how qualified we are!

Good luck!

Sincerely,
Grace Morioka, SRES, e-Pro
Area Pro Realty
Co-Host "Naked Real Estate" on http://www.blogtalkradio.com