Many seller's agents are requesting for the buyer's to get preapproved with XYZ lender as a stipulation for submission with their offer. What if the buyer trusts their OWN mortgage broker or loan officer of choice?
In a situation where I've had a repeat customer who did choose their own loan officer and the seller's agent demanded a preapproval from the funding lender of their choice is when my clients became very leary.
The cons of ‘forcing' a buyer to get preapproved AGAIN:
- They trust their own loan officer because they've used he/she before and did a great job. (AND..it was their choice so there is no conflict of interest)
- They are getting leary as to why they HAVE to have another lender pull their credit ....again.
- If the seller's agent has stated to use XYZ lender for a preapproval ...they really start getting leary.
- They dump their loan officer and go with an unknown loan officer who promised them the world and doesn't perform.
- There is nothing in writing to the buyer from the seller stating that they are requiring the buyer to run their credit again and get a preapproval from a funding lender.
The pros of having a buyer get preapproved AGAIN:
- Shows the seller that they are qualified with a funding lender and no worries that the qualification IS worth the paper it is written on.
- Gives the seller's agent some control over the situation in presenting a more solid offer to the seller.
- If this stipulation is on the listing agreement and signed by the seller then it IS the seller's request and not the agent. (might as well go further and have the seller sign something to present to the buyer.)
- The buyer's offer will be considered amongst multiple offers submitted for the same property.
There are times I've given my buyer's a list of loan officers I've worked with (especially relocating military who know no one here) and they speak to and choose which one they want to work with. But I do NOT choose a lender or loan officer FOR them!
In summary, my belief is that there is NO solid transactions until recording. There are always bumps in the road and other circumstances that buyer's will back out of a contract (i.e. home inspection, title issues, termites etc.) ........But HAVING TO get a SECOND preapproval letter with a XYZ lender after they have already gone through a complete credit and application process with their own loan officer is when I think that a demand for a statement signed by the seller requesting to do so may be a good option.
........for all involved.