I have this deal that absolutely must close in ten days. They want an Arizona mortgage with a 10 day close.
I was chosen as the lender because I offered the best all-around deal, and I was also well-acquainted with the Realtor, or so I thought.
Because the client was scrutinizing every legitimate cost, I went with the lowest priced wholesale lender, so that I could pass on the lower fees to the client. Regardless of what clients tend to believe, most fees on the Good Faith Estimate have nothing to do with the lender.
For example, I can not control how much my clients pay for homeowner's insurance. They can go with Geico, or they can be smart and go to CostCo. But all I can do is give them a recommendation for insurance (as one example) and then total up all of their closing costs for them.
Of course, because of my client's insistence that I use the absolute lowest priced-lender, because a $50 difference from one lender to another was too much as far as my client was concerned, I also had to go with one of the slowest wholesale lenders in my area.
I made this clear to the borrower. There is a lot of give and take in the mortage world.
About a week before the closing, I called the buyer's Realtor and my client-- three way.
I explained that we ran into a slight glitch that was beyond my control. The loan should have flown through underwriting, exept that:
The house inspection came today and one of the windows needs to be repaird.
If the my client's realtor would just let it go, we could get this thing closed.
But for an $80 window, the Realtor wants to re-write the contract and change the purchase price by $80. She thinks that she is looking out for her client's best interest.
She thinks she is being "super extra diligent."
She thinks she's being smart.
I think she should look into a new career; one that requires less brain power.
Getting the window fixed is going to delay the closing and cause me to, basically, start over from scratch. If the rates get any worse, I'll have to pay for a rate extension, which really means that my client will have to pay for a rate extension.
This is the same client who asked me to avoid using my preferred lender because they wanted to save $50 in closing costs. Now we are bickering about $80.
So here is what I am going to do now: In order to meet the close of escrow date, and since I need to start over from scratch, I am going to move the loan to my preferred lender-- my fastest lender.
The fees are about $150 more with my faster lender.
That means the client will end up paying $150 to save $80 for a silly window repair and, if I need to extend the rate lock, the client will be paying for that too. So far the Realtor has cost her client $70 extra dollars and it can only go up from here.
Guess which Realtor will never get another referral from me a long as I live? I mean, if somebody calls me up and says they need a Realtor who does not understand basic math and is thick-headed and arrogant, sure, I'll recommend her.
And after this all goes down, I will be informing my client of the horrible job his Realtor did. She'll probably lose his referrals too.