I am not sure if very many agents have had this happen but today, it happened to me. A potential buyer last week seemed very interested in using me as their buyers agent. We spoke, sent texts and emailed back and forth. Today I called to follow up and was informed, “oh sorry but I found another real estate agent through my bank”. Uh oh...with a sinking feeling in my stomach I ask, “is it through USAA ?” to which he replied “yes it is”. Here in Fayetteville, NC this seems to be an issue that comes up time after time...we have a huge amount of military who use USAA to bank (which I also use to do my banking). However, when people go to use them for a mortgage they are offered up to $1500 cash back if they use USAA as their mortgage lender.
This is very frustrating to me as an agent. The buyers have no idea they are paying for this $1500 they are getting back in fee’s and sometimes higher interest rates! They are also getting the next agent on the list...not always the best agent for them, as well as an agent that is giving up a huge portion of their commission just to get the business...which again is not always to the clients best interest. I have heard of agents only showing houses with bonuses or higher commissions just so they can make more money.
I personally have had two clients this past year who wanted to use USAA, and once we got the Good Faith Estimates realized they were actually going to be charged more going through USAA than using a local lender. I always suggest to my buyers to speak with two lenders and compare...who is going to give you a better rate, and charge fewer fees. After all, this is your money Mr. and Mrs. Buyer. You may get $1500 back at closing, but when you pay almost $700 in processing fees and then a higher interest rate, that $1500 really isn't that good of a deal.
Shawna I completely agree with you. This blog caught my eye right away. I will be writing a blog later this evening about a local lender sending my clients to FSBO's.
Shawna - OMG!!! That's despicable! It just amazes me how carelessly people choose their lender and Realtors. One of the biggest purchases of their life and they spend less time and consideration choosing the people to help them than they do ordering a pizza. It just makes no sense to me.
David-gotta read that one. Sounds very interesting!
Shawna-great point. We have to educate buyers to look at the whole picture. If they don't know to, then they don't know how bad the deal really is. But it's a huge challenge to overcome such a large influence in a military community.
Amanda, yes we need to educate them, but sometimes we never get that chance....and I am unsure how to get that information out there sooner!
Shawna, the lender is such an important part of the transaction and the charges can be so different. Such a good recommendation to your buyers.
I agree.... Lenders are so important and can be vastly different. I have found a few that I trust completely and cringe when the buyers use someone else... even the ones that aren't part of a referral network like usaa, you never know when they are gonna "refer" YOUR buyer to another REALTOR!!! I have had that happen and of course it was the last time I sent a buyer to THAT lender!
Shawna, I do not understand why buyers would still want to take real estate advice from their loan officer.
Shelia, I am lucky enough I have never had a lender send my clients to another Realtor...but I agree, I would never use that lender again!
Ellie, well in the case of USAA in order to get the $1500 they have to use their "preferred Real Estate agency". There are 2 companies that share those leads and it goes to the next agent in line.
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