This is a question every home buyer should ask themselves especially if your Realtor/Agent has not encouraged you to Shop, Compare and Save.  Above and beyond the Rate of Interest and Closing Costs, buyers need to keep in mind that one person/house is controlling the entire transaction.  Recently, I was dealing with a buyer that was looking at a New Construction home and as part of the transaction the builder had incentive to use the builders lender.  The buyer ultimately walked away from the transaction for a number of reasons.  One of the reasons was they were feeling pressuredin general.   Also the fact that the Seller/Builder was controlling every aspect of the transaction.

• Selling the home
• Arranging the Financing
• Obtaining the Appraisal from one of their chosen Appraisers
• Doing the Title Work
• Doing the Closing with their affiliated Title Company

Ask yourself if you want checks and balances by not having everyone in the transaction living under the same roof or having affiliated business arrangements with the individuals they deal with. 

As far as a history lesson, consider Car Dealers, it is common place for them earn referral income when they arrange the financing for a car buyer.  Also with the number of Cars Repossessed, a sales person is encouraged to do everything possible to get the car sold.  Ask yourself if you are doing what is in your best interest or what is in the best interest of the Salesman/Dealership.  

Here in Ohio, there are laws preventing your Realtor/Agent from receiving income on a per transaction basis from the Lender or Title Company, however via your Realtors ownership of the affiliated business or another indirect ownership thru an Affiliated Business Arrangement, there may be some conflict of interest.   This is the reason buyers and sellers sign AfBA Disclosures.   If you are asked to sign one of these forms, ask your agent/Realtor to explain to you any financial incentives they receive.   If they say there are NONE, ask them if the company they work for tracks the number of referrals they make to AfBA and if these numbers are discussed periodically with their managers. 

I know some Agents/Realtors that work to save their clients money via referrals to lenders and Title Companies, however I know others that make those referals with income or profits being their motive.  If you agent/Realtor does not encourage you to independently Shop and Compare, do it for yourself.  Convenience shopping at times can be good, however at time Convenience Shopping is not a buyers best option.