Mr. Seller - you want me to use your lender. Really!
I don't know about every other buyer and their Realtor hunting for homes today, but there has certainly been a surge in the listing side of a transaction requiring a buyer to qualify through the seller's designated lender. Now we understand the big banks, BofA, WFB, all directing approvals to be considered on their REO offers. Do not like it, but we do it. Since those companies control a large portion of REO's, it's a good chance the letter can be used on a subsequent offer.
But... there has been a trend on flip properties and now this week, a single traditional seller requiring "buyer must be pre-approved through Mr. Lender at ABC Mortgage". Really? It's fairly clear that the flip properties probably have an additional relationship with the lender. But why on earth would an individual seller make this requirement.
Our Sacramento market has changed into a very competitive market with low inventory and buyer's need to be nimble and ready to write that offer and perform quickly. The process of pre-qualification is to insure the buyer's ability to close on a transaction. it takes work and effort. If they are already pre-qualified through their mortgage banker of choice and a big bank lender, they are prepared. What else could the seller's lender possibly do to add to the approval that has not already been done. I do not see where another approval helps the transaction AND having multiple lenders run multiple credit reports is not in the best interest of the buying public.
I am not a fan of seller directed pre-approvals, but with the big boys, it makes some sense. But for this requirement to trickle down to average, traditional seller - seems a bit too far. Buyers & Seller's, please make sure you agent explains fully the merits of this process before you proceed with one more pre-qual.