Not All Lenders are Created Equal. Here's Looking at You BofA

If you are not a cash buyer then your first step when buying a home is  to find a good lender. You may already be a pro at home buying and have a good go-to loan broker, but if not you will need to find someone who will make the process run smoothly and not run the risk of losing the home.    

My buyers client recently closed on a deal where both buyers and sellers were reasonable and everything moved smoothly towards the contract signing and ultimately agreement on repairs. That done one would think that things would have gone without a hitch towards closing. What we didn't anticipate was the fact that the bank where the buyers have been clients for many years and where they have numerous accounts would not have a clue how to handle a transaction of this size and understand how to deal with time-sensitive requirements.

Bank of America might be a great source for smaller loans, under $1 million, but they do not seem to be set up for larger ones, such as ours which was $1.6M with 50% down on a $3.2M homes. Seems like a no-brainer right!  Wrong. No one seemed to know what the next person was doing. Nor did anyone seem to grasp the urgency of sticking to deadlines, all of which were dropped. The appraisal was ordered too late so that the appraiser only went out after the deadline for removing the appraisal contingency had passed. No effort was made to try and find an appraiser who knew the area, and the comparable homes used for the appraisal were all incorrect. The buyers were constantly being asked to supply paperwork which had already been submitted and there always seemed to be one more item they needed. The buyers were given dates that the bank did not stick to, and they almost lost the house. There was no one point of contact who could be relied on and misinformation was constantly passed on. Fortunately the sellers stuck with the buyers, and the deal closed.

Ask questions from your lender. Find out what kinds of loans they have made in the past. Make sure your real estate agent is involved because they might be able to spot the red flags. Using a loan broker rather than a commercial bank is a good way to go as generally they know the best sources for a particular type of loan, understand the urgency of the escrow process and know whom to put pressure to make things happen.

Being loyal and sticking with who you know is a good thing, but not if it loses you your ultimate goal.