Pre Approval Letter and Available and Trust Worthy Mortgage Bankers

Pre Approval Letter and Available and Trust Worthy Mortgage Bankers

A good mortgage broker is hard to find.  It has taken years for me to find a few golden nuggets and shiny diamonds.  Get a pre approval letter immediately.  There are loan officers that seem to work 11 am to 4 pm and take Wednesday off.  The good lenders will (in an emergency!) pick up the phone on a weekend and after 5 pm and before 9 am.

All buyers are not in a hurry until they find "THE" home.  Don't wait until you find the PERFECT home at the perfect price because you can be sure that there will be other buyers who will also think that it is the perfect home for them.  Don't learn a lesson the hard way.  Prepare and avoid heart ache.  

I've heard horrible stories from sellers who are short selling their home and getting out of predatory sub prime mortgages.  I see potential horror stories when buyers tell me they are going to get a pre approval letter from a lender from the phone book or from the internet.  One seller was able to get a no documentation loan over the phone 3 hours before closing on a million dollar home.  I've met sellers who did not own their home long enough for the adjustable rate mortgage to reset.  I've met sellers who are now short selling their home who have told me that they were at the closing table when they found out their interest rate was 2% higher than what they were promised and that there were tens of thousands of dollars in points and fees on the settlement statement at closing.

3 Buyer Experiences To Learn From

Loan Officer 1

A buyer went to a local bank to get a pre approval letter.  As the buyer talked to the loan officer over the next few days the buyer got more and more excited. 

The good news was that the monthly payment that she was qualified for was 1/2 of her current rent payment.  My buyer couldn't imagine buying a home and only paying 1/2 of what she had been paying in rent.  My buyer had rented the same home for 15 years.  Her home could have been 3/4 of the way paid off if she had purchased 15 years earlier. 

The bad news was that it was almost 2 weeks after my buyers first conversation with her loan officer and we still did  not have a pre approval letter. The other bad news was that we knew that the total loan amount my buyer was qualified for was going to be lower than any home on the market.  I told my buyer not to worry and that new homes come on the market every day. 

Miracles do happen!  A day or two later a home in my buyers price range popped up on the market and we wrote an offer.  My buyer knew that we would be unable to present an offer on a short sale or foreclosure property without a pre approval letter.  The flexible listing agent told me that the seller would sign the offer as soon as we provided a pre approval letter.  The buyer called her loan officer again.  In her excitement my buyer told her loan officer the property address and her offer price.   

Less than an hour later the listing agent called to say that she had received another offer and the seller had accepted the offer.  We were shut out.

My buyer got on Facebook to rant and saw some comments that one of her friends who worked at her bank where her loan officer worked was talking about the great home that she just signed a contract on.  The buyer and I found out that her loan officer told a co-worker to write an offer for $5,000 more than our offer.

Loan Officer 2

A buyer went to a loan officer to get a pre approval letter.  My buyer was in the process of providing paperwork when she decided to look at a very inexpensive condo that had been on the market for about 45 days.  The mortgage payment was going to be less than half of what she was currently paying for rent. 

We pushed the loan officer to give us the pre approval letter.  The next day we had the pre approval letter.  We submitted our offer.  The listing agent said they received an offer last night and the property was no longer available.  I asked her why it was still "Active" in the MLS?  The listing agent said that the buyer missed an initial on an addendum and still needed to sign the bank addendum.  The listing agent would not allow us to submit our offer.  The listing agent said the bank had already accepted the first offer.

Later in the day the loan officer told me about a great deal that would be good for my buyer.  I called the listing agent.  The loan officer sounded very surprised and asked, "How did you find out about this property?"  I told him that the loan officer told me about it. 

The property was under contract and the buyer was having some trouble getting his loan commitment.  Then it hit me.  I called the listing agent with the cheap condo and asked her who the buyer's loan officer was on the first condo.  It was the same loan officer.

I never called this mortgage broker again.

Loan Officer 3

I had 2 houses under contract with the same buyer.  The buyer was an investor.  3 weeks before closing the buyer pulled $700,000 cash out of another home.  I got the news from the loan officer that the bank would not be able to fund the deal.  A moment later I got a call from the loan officers best buddy who happens to be a Realtor.  The loan officer's friend was calling to find out how the deal was going.  The Realtor had a cash buyer who was ready to close with a very low offer.  They would have their signed offer ready before 5 pm.

I called a loan officer who has earned my trust over the years.  His bank was happy to fund the deal and the file closed on time.

I never called that loan officer again.

Buyer beware.  Ask your trusted Realtor about trust worthy loan officers.  Get a pre approval letter before you find a home you want to buy.  If we have a pre approval letter in our hand on the day we find the home you love we are less likely to loose the home or end up in a multiple bid situation which will cost you more money to buy the home.