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9 Comments on Using the Builder's Lender? Pay attention....
Wow that is crazy. I just hate when people fraud clients. That is just wrong
Ben
Kaushik, this is a very good post! Builders' lenders often do not give a good deal. Either the rates are high or the rate/point combo is not competitive. A lot of builders tie incentives to using their lenders but most people are not aware that you are not required to use a builder's lender to get those incentives they offer.
Ardell, you're talking of something a bit different. That's warrantability and yes, you're often required to use the builders' lender because they've made arrangements ahead of time to bypass the warrantability issue. If you do run into that issue again, look at the following lenders: Chase, HSBC, BofA, Greenpoint.
They have somewhat lax rules about warrantability. I believe even Wells Fargo has some program.....rates are great, but it's better than nothing.
- Tchaka
Ardell - You are absolutely correct. Too often the enticement for using the builders lender is too high. We must, however, as agents perform our due diligence whoever the lender is.
Ben - And hopefully forums like AR will serve to educate the consumer to help prevent fraud from occurring...
George - Absolutely! I mean we're talking a major national builder, not just some joker doing loans out of his trailer....
Tchaka - I would think that in some cases, you would HAVE to use the builder's lender to qualify for the full incentives, no?
Kaushik,
I'm attaching an article for you to read. There's one case that talks of a builder tying incentives to using their preferred lender.
http://creditboards.com/forums/index.php?showtopic=217519- Tchaka
I will say, as I have on other posts, that in most cases the builder is merely protecting their client from the host of terrible lenders out there, the sub-prime meltdown merely proves this point.
Builders have to know if the lender can really make the loan, and frankly a lot of lenders can promise the realtor and the client, and then at the end can really mess things up.
Maybe that's the case in Valparaiso, but where I've been, many of the builder lenders are not A-list lenders. And builders are more interested in their own preservation, not that of the clients. So, I do not agree with your statement.
- Tchaka
Tchaka - Great article, thanks!
Steve - I think its really a case by case basis. I won't necessarily claim the builder's lender can't get the job done in a majority of cases...but I do seem to encounter builder's lenders that do charge a little too much....