Way back when I started in Real Estate I was taught to ask lots of questions of buyers to determine their ability to obtain a mortgage. Especially if that buyer was considering a co-op purchase we needed to ask and then ask more questions. We needed to know. Where did the buyer work, how much did the buyer earn, how much savings did the buyer have, after the down payment on the mortgage and closing costs what savings would still be in the bank, and lots of other questions. We all worked for the seller back then, remember. When I started I was uncomfortable asking these questions, felt that I was really entereing the realm of what is very personal information. But I learned. I wasn't being nosy, there was a need to know. A need to protect the seller and insure a smooth uneventful closing.
That was back then. Bank guidelines were simple. There was few products available and it not complicated to know who would qualify for what. Then things changed. Banks and mortgage company's started to offer many different products. Each bank offered something different. In order to qualify for these products buyers had to meet different ratios, some were no income verification, no employment verification, no anything verification the buyer would simply pay more in costs and a higher interest rate and get financing. Things began to get too complicated for real estate agents so we sent the buyers over to the mortgage brokers to figure out which bank, which product at which rate would best fit that particular buyer.
I think we are now back at having to ask the questions. Is the buyer employed, where, income, how long employed when we receive an offer. How can a seller in this market and environment not ask those questions. Rcently an agent presented an offer on one of my listings and I asked some questions. He said I will provide a preapproval. I believe that mostly these preapproval are useless. The preapproval he submited said that "if what the buyer has told us, and subject to income and employment verification, FICO check, appraisal, then maybe we will provide financing" IF and MAYBE. Should a seller depend on all of that happening without furthers questions when considering an offer or do they have the right to ask the questions.
Comments(6)