Wondering if this isa fair practice for realtors to enforce pre-qual from their affiliates even though the home is fannie-mae or similar

Asked by Taza Guru, Sunnyvale, CA Sat Nov 12, 2011

Wondering if this is a fair practice for realtors to enforce pre-qual from their affiliates even though the home is fannie-mae or similar. I would like to minimize the number of credit report inquiries and I hate to work with a new lender even though I know I do not NEED a new lender. Appreciate your thoughts.

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Susan Lehmku…, Agent, Scottsdale, AZ
Mon Dec 19, 2011
I'm seeing this more and more even with non institutional sales. The seller has the right to know that they buyer is qualified and will be able to secure a loan in order to purchase a property. I would like to think that all loan officers do their due diligence before issuing a pre-qualification form but unfortunately that isn't the case. The result is that a seller may accept a buyer's offer only to have the deal fall apart at the last minute because the buyer wasn't able to qualify.

When I have listings, I don't require buyer's to pre-qual with a specific LO or bank but I do call their mortgage professional to discuss their ability to qualify for a loan BEFORE I present the offer to my clients. I want to be able to assure them that the buyer is qualified and will be able to close the deal. Nothing worse than having to go back to your seller and tell them to STOP packing because the buyer couldn't get funding.
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Randy Hooker, Agent, Chandler, AZ
Sat Nov 12, 2011
You're asking if the practice is "fair"?? In my opinion, there's no such thing as 'fair', especially when it comes to real estate contracts and transactions. It's extremely critical that you have excellent, experienced Buyer's Agent representation, and that you make yourself aware of all the in's and out's of submitting an offer and negotiating a contract on a bank owned property. While you might think they can't be that difficult, since so many do them, you would be shocked at how complex and challenging they can be.

Also, whether YOU think you need a pre-qual from another lender is irrelevant. Sellers have a right to require it, even if you don't like it.

Best of luck to you!
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Roswell Moore…, Mortgage Broker Or Lender, Scottsdale, AZ
Sat Nov 12, 2011
Hi Taza,

You can offer to have your existing credit report forwarded to the "seller banks loan originator" for review, instead have another credit pull on your report. I have done this many times for my clients. Have your lender also send a copy of the "DU Approve Eligible" findings from their automated underwriting engine. Many times the seller-bank's LO does not want to take the time to go thru the entire pre-qual if they can see that your lender has done their job on their pre-qual.

Hope that helps.

All the best,

Roswell Moore, CMPS
Certified Mortgage Planner
480-422-5095 direct

We are a Direct Lender, Mortgage Bank where we originate, process, underwrite, fund, AND SERVICE our loans, in-house, with FHA (starting at a 580 score AND still only 3.5% down), FHA Streamline loans (no minimum credit score, no appraisal required) Go Green rehab loans, HomePath, Investor Friendly (10 financed properties), VA, USDA, Jumbo, Conventional, plus, we allow Escrow HoldBacks!
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Sonny Shriva…, Agent, Goodyear, AZ
Sat Nov 12, 2011
What Marge said. Spot on.
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Sandra Paulow, Agent, Pinetop, AZ
Sat Nov 12, 2011
I'm not sure what you are referring to when you say an "affiliate". However I do know that some Asset Managers for particular banks are asking that any buyer for that asset apply with specific banks. Usually the "big" ones.
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Marge Bennett, Agent, Fort Myers, FL
Sat Nov 12, 2011
It is very important that the listing agent and the seller be able to trust the pre-qual. Unfortunately, many of them are not worth the paper they are written on. Many banks want to know that if the lender of the buyer's choice won't lend the money, that the selling bank would be willing to lend to the buyers.
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