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(My momma told me) You Better Shop Around!

By Janna Scharf

Real Estate Agent with Keller Williams Realty Coeur d'Alene AB37665

April 16, 2011 07:56 AM

Janna Rankin Scharf, CLHMS, GRI, SFR - Coeur d'Alene Idaho Homes For Sale

I have been working with some pre-approved buyers in a search for their perfect home. We finally found it! The next step was to get the ball rolling on their mortgage loan application.

Shoes Being the analytical guy that he is, Mr. Buyer decided that although he had been pre-approved by a lender, he wanted to shop around for the best possible deal on a mortgage. He spoke with four different lenders and received a Good Faith Estimate from each of them. He carefully analyzed fees, rates, and costs associated with the loans.

At the end of the day, one stood out heads and shoulders above the rest. He took that GFE to the lenders who didn't quite measure up to ask if they could meet or beat it. I was impressed that they agreed it was a great deal, said they couldn't beat it, and told him he should take it! The winning lender assured him that if any additional fees or costs not reflected on the Good Faith Estimate turn up on the closing settlement statement, the lender will pay for them.

My happy buyer is getting a lower interest rate, lower out of pocket costs and a lower payment than he was expecting. All because he took the advice of Smokey Robinson's momma - you better shop around!

(The reason I'm not mentioning who that winning lender is, is because it is going to be different for each buyer based on a myriad of factors involving everything from credit score, loan program, property being purchased, etc. Best advice is to do exactly what he did, shop around!)

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Janna Scharf

Keller Williams Realty Coeur d'Alene - Coeur d'Alene, ID

Coeur d'Alene Idaho Real Estate Expert

Yes, Luz, he is VERY analytical as I found showing lots of properties to him! :-) In the end, it sure paid off for him.

Apr 16, 2011 08:05 AM

Karen Burket

Bank of Oregon a division of Willamette Valley Bank - Medford, OR

Valley Mortgage Grou, Conventional, FHA, VA, mortgages

That's great for your buyer! I will say however, as a mortgage loan consultant myself, I find it frustrating when I'm contacted by a buyer, spend time with them, educate them, analyze sometimes difficult tax returns, spend resources to pull a credit report, THEN write a strong preapproval letter that assisted in sealing the deal on their offer, only to find out after the fact, NOW they want to shop. I think buyers should be encouraged to "shop around" BEFORE having a random lender supply them with a preapproval.

Much like a Realtor spending countless hours showing properties to a client, only to find out they made an offer with a listing agent at a Sunday open house.

There is no reason they can't do their preliminary shopping, then commit to a particular lender. JMO

All the best and congrats on the deal! :-)

Apr 16, 2011 08:06 AM

Sharon Tara

Sharon Tara Transformations - Portsmouth, NH

Retired New Hampshire Home Stager

I can't get past the photo...what's the story behind this shot?

Apr 16, 2011 08:10 AM

Karen - You are absolutely correct. His shopping opened a can of worms that is another post for another day, but in the end he had to do what he had to do.

Sharon - :-) My son had a few of his friends over and I thought it made a cute picture.....

Apr 16, 2011 08:17 AM

Mike Mayer

Mike Mayer, Broker/Owner - i List For Less Realty, LLC - Lafayette, LA

Most of us shop for products and services in order to secure what is considered 'best' - best deal, best rate, best price. It just makes sense.

I've previously worked with Brokers who focused on 1-stop shopping where they were aligned with only 1 mortgage lender, 1 title company, etc. While convenient, this is not necessarily in the consumer's best interests. Most consumers shop only interest rates, however, which is a big mistake.

Apr 16, 2011 08:26 AM

Ron and Alexandra Seigel

Napa Consultants - Carpinteria, CA

Luxury Real Estate Branding, Marketing & Strategy

Janna,

That was a wonderful story, and I love that song. Thanks for sharing it with us. A

Apr 16, 2011 12:32 PM

Anna "Banana" Kruchten

HomeSmart Real Estate - Phoenix, AZ

602-380-4886

Jana - it's so nice to see you! We must be running in different circles or time zones....so I was delighted to see your smiling face!

I've worked with a lot of analytical people of the years - it takes a special skill to have patience with them at times. (my husband is an engineer so I've had practice!). Good for your buyer in making the right choice for him.

And.....I love the picture. It reminds me of my home growing up in a family of 8 plus at least another 10 or so kids!

Apr 16, 2011 02:06 PM

Andrea Swiedler

Berkshire Hathaway HomeServices New England Properties - New Milford, CT

Realtor, Southern Litchfield County CT

Janna, oh thank you for the song at the end of your post, I loved it! Shop around, great advice. I can understand what Karen was saying though. Wouldn't it be great if they all shopped around before we took them out?

Ah well... again, thanks!

Apr 17, 2011 01:41 PM

(My momma told me) You Better Shop Around!

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