Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
First time buyer here, so this is all new to me. Please bear with me.
I've been shopping around for a house/townhome/condo for the past several months. After several offers, I finally went under contract on a condo about a week and a half ago. Throughout the process, I had been working with a mortgage broker that my realtor had referred me to. At the last minute, his rates went up and so I decided to shop around for better rates. I found a place that cut my rate by .25% percent and also about $2k in closing costs. I was pretty happy about it.
So I filled out all the requisite paperwork with the new lender and we got things rolling. Today, the confirmation that the appraisal has been ordered came through and I also went through inspection. We're still 40 days out on the closing date.
Anyway, my realtor received an email this afternoon from the seller's real estate broker (see below; I changed the names for their confidentiality) regarding my choice to switch lenders. She essentially said that she does not prefer to deal with my lender, and would rather me work with the local lender I had originally been referred to. She said she was concerned because another offer fell through because a co-signer backed out, which has nothing to do with the type of lender used.
Everyone I've talked to (friends, family, co-workers who are both into real estate and are attorneys) thinks this sounds extremely fishy, as if the seller's realtor and the local mortgage broker are in cahoots with one another and they're trying to force my hand. It kind of makes me angry, as if they're trying to dictate who I work with and what rates I pay. My realtor also played both sides of the fence and sort of leaned towards me using his referred mortgage broker. That also made me a little angry, because I felt like he didn't have my best interests at heart. I did research on the new lender on Zillow and some other review sites, and it received really good reviews (4.5, 4.7/5). I have no reason to believe that they will not meet my closing dates.
After consulting with some of my co-workers who are in legal and real estate, I ended up telling my realtor to tell the seller's realtor, "Thank you for your concern, but I'm happy with my current broker and have had no cause for concern at this time."
Has anyone ever dealt with something like this before? What are your thoughts about what took place here?
Note from Seller's Realtor:
Quote:
I received a call from John Doe with Local Lending Company, he said that the buyer has decided to go instead with an "online lender". My sellers and myself are very concerned by this as it has been my experience that these non-local/hands off lending institutions are extremely unreliable and often the reason why many deals end up failing in the final hours as issues come up that were not addressed early on.
My sellers were already under contract before with a buyer whose financing was dependent on a third party co-signer who backed out causing the financing to fail and they would be devastated to have another deal go south in a similar fashion.
I personally have done transactions with Local Lending Company and was so impressed by there prompt and efficient handling of even difficult cases I actually switched one of my buyers to use them rather than simply to ensure a flawless execution.
We highly encourage your client to reconsider the online lender and continue on with Local Lending Company. We can not count on online companies to be on top of dates/deadlines ect and I am sure your client does not want to risk losing this property in addition to earnest money/inspection/appraisal costs ect if the lender fails to perform.
Thanks for taking these concerns into consideration, Ill look forward to hearing more form you soon.
I don't see this as a big deal. The selling agent has priorities that are different from yours. You declined their suggestion and are moving forward. No harm has been done.
I will say that getting the paperwork for a mortgage done on time is a bit nightmarish. It always seems that the mortgage company gets their act together only at the last moment. I don't know if internet lenders are better or worse about this.
Tell them all to **** off and be diligent with your lending, a rule no matter who your lender is. Stay on top of them and check on the progress every other day. And make sure they understand you want to sign early so if something does happen you know before close day. If your agent won't respect your decision demand to speak to the agents broker and request a new agent.
Tell them all to **** off and be diligent with your lending, a rule no matter who your lender is. Stay on top of them and check on the progress every other day. And make sure they understand you want to sign early so if something does happen you know before close day. If your agent won't respect your decision demand to speak to the agents broker and request a new agent.
Yeah, that's definitely my plan. I actually voiced my concern with my new lender this afternoon and this is what he said to me in response:
Quote:
The longest I have seen a purchase take to get approved is 27 days on a 30 day lock. We are 40 days out to close, you have all your docs in, and the appraisal has been ordered. We will be waiting on you guys to get this closed. We have never missed a purchase deadline, nor will we....Don’t worry, I will take care of your mortgage, make sure we close on-time, and hit all the dates in the contract.
As a Realtor, I hate dealing with online lenders. They rarely come through. They do very little due diligence up front and don't tell you that you aren't qualified until just before closing. I've had two deals in my office fall through recently because of online lenders. I ALWAYS recommend a lender who you can talk to face to face. Shop local
As a Realtor, I hate dealing with online lenders. They rarely come through. They do very little due diligence up front and don't tell you that you aren't qualified until just before closing. I've had two deals in my office fall through recently because of online lenders. I ALWAYS recommend a lender who you can talk to face to face. Shop local
One of the most prominent mortgage companies in the US, Quicken, works with home buyers all over the country. Heck, they even have an arena named after them.
As a matter of fact, when I called Quicken, they had the same exact rates and closing costs as my local broker. Most likely, he was working with Quicken on the deal, as his company was not personally financing the deal (the broker I'm working with now is a subsidiary of a major bank that will be financing the deal). He was just the "face" of the deal. What's the difference between that and the lender I chose?
Honestly, to me and all the people I've talked to who AREN'T trying to make money off me, this sounded like a deal between the local lender and the real estate agent. I'll scratch your back, you scratch mine. But I'm sure that never happens in real estate...like ever. It's not like there is an incentive or anything.
In my experience Quicken gave me a little hope in online lenders. Too many bad experiences in the past with what I call mybuddy.com from when one guy started every conversation with "Hey, buddy".
You still need to be aware of what closing costs are in your area and what the buyer normally pays and the seller normally pays. Even in places where closing costs for a buyer are paid or partly paid by the seller there are some things the buyer pays himself. Online (out of town, out of state) lenders are usually not aware of what is common in the individual small area. While they are sometimes surprised, like at the several hundreds that are for a particular process we don't even know if anyone actually physically does, and that isn't charged in an area I'm familiar with, Quicken has been amenable to crossing it off.
It would be good if your settlement company/atty was in your area and versed in your area. I've seen problems with some where the settlement papers came from an office out of state to a settlement company locally who did only a curtesy settlement and sent the paperwork right down to the out of state office. I forget what they called that...a visual settlement or something where the local office just handed the paperwork around and witnessed that it was all signed.
Just had a casual conversation the other day with one of my favorite mortgage brokers. I had read something in a forum and passed it on to him regarding Quicken. This was his reply
Quicken Loans is in the middle of a major law suit with the DOJ over fraudulent FHA loans.
I'd be cautious at the very least, OP. We don't like mainlaind OR online lenders here either. Local lenders familiar with YOUR market and location are a safe bet, in my opinion. I know Quicken may be okay for some but I don't recommend them. In fact there is a local lender or 2 here that I'm not so crazy about either, due to experiences with them in the past!
I would definitely thank the other agent and continue to be cordial and professional. You may need to ask for an extension so don't burn your bridges.
As a Realtor, I hate dealing with online lenders. They rarely come through. They do very little due diligence up front and don't tell you that you aren't qualified until just before closing. I've had two deals in my office fall through recently because of online lenders. I ALWAYS recommend a lender who you can talk to face to face. Shop local
What? "They rarely come through" and "two deals in my office" really strains your credibility on the subject. And what is it you are doing as a "realtor" with an online lender that makes you hate them? I don't think any of the multiple agents I've hired spoke a word to any loan officer or broker related to my transaction. Once in the loan process, I was in direct communication with the loan officer and writer.
A buyer should pre-qualify with a lender, whether local or not. To attribute 2 broken deals to online lenders implies that your office's buyers did everything right, but the lender messed up. While this is completely possible for any number of reasons, it is an overgeneralization. Deals crash for lots of reasons.
Online deals, brokered with telephonic and electronic communications, is how business is transacted, even at your local bank. Heck, at my local branch, I have to swipe my debit card for a teller transaction.
You should be advising your buyers to research multiple offers and select based on what is important to them. Most buyers (my generalization) want a combination of reliability, customer service, and competitive pricing. Often, local credit unions can compete--some will even match offers as a marketing technique.
The best deal for your client should be your priority. I doubt a local lender is "ALWAYS" the best.
Buyers: Interview multiple RE agents. Shop for a mortgage. Get pre-qualified.
No--there is nothing suspect about it. The seller's agent's job is to protect the seller. The agent does not have a deal with the local lender.
What you are reading/hearing is the agent trying to protect his/her clients. He or she is doing just that by indicating their previous experiences with online lenders. The agent's experience with online lenders has not been great. There is a reason for that. It is the listing agent's job to advice his/her client of potential issues and try to prevent problems before they happen.
In terms of you expressing doubt, at least as I read it, about the back scratching that goes on between various parties in a transaction, think about that. You are talking about their jobs and their paychecks. How many people do you know that would act in an ethically challenged way regularly and risk their paychecks? Not many is my guess. The same holds true for agents and lenders. They are people just like you.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
