I followed up with an agent the other day who had showed one of my listings and she made the comment to me that she usually doesn't let people in her car unless they have a prequalification letter. I admired that, and I got to thinking about my own experiences, and one recent circumstance in particular.
As all agents know, time is our most precious commodity and where we spend it should be more about investing it than "spending" it. A couple contacted me about a home for sale. It was not for them, so we agreed that I would send them some e-mails with homes that met their criteria. At this point I could have asked them if they had spoken to a lender. I did not (often I will at this point). They sifted through the homes I sent, found some they wanted to see and we met on a Saturday to look at homes.
My rule is this: I will take you out one time to look at homes without having talked to a lender. Usually, if I can get someone in my car they begin to feel comfortable with me and I can broach the subject of financing. Discussing it face to face is much better than over the phone because it is such a personal subject. I always try to recommend someone I have a working realtionship with. If they want to preview homes a second time they need to have talked to a lender.
The couple in question applied to an online lender after our first visit and got "pre-approved." I was wary to say the least because they the details they were giving me did not make sense. I had given them the name and number of my friend at Regions Mortgage, but the couple did not take any action on that. They were making an effort, but we had not reached a high level of trust. We went out a second Saturday for some second looks and narrowed the field. After a 3rd Saturday of looking at the 2 finalists, they made a decision. A few days later we sat down to write an offer.
Before we sat down to write the offer, I had tried to get a pre-qualification letter from their lender, but was unsuccessful. I figured that we would probably not write an offer that evening. However, I had a very good opportunity to take control of the situation. We had driven around town together on 3 separate occasions and the level of trust was high. We talked about the lender and down payment and there financial situation, and I knew that the online lender was not going to work. They allowed me to recommend someone who handles less than ideal credit, and they got approved!
This family really wants a home and they are willing to do what is necessary to meet the conditions of the lender. Plus, it will be a good sale for me. If I did not take them out that first weekend to see what was available, to dream build, all of the pushing and prodding in the world could not make them talk to a lender. They just would have found a realtor who was willing to show them houses. Instead, I have a new client that trusts in what I say and is willing to refer me business