A temporary Jumpstart

Real Estate Agent with Keller Williams Realty

I was sitting in my office today beside our mortgage lender when a fellow agent started inquiring about a buyer he had who wanted to purchase a three unit investment property and live in the one with no money down and a 502 credit score.  He was asking if there is anything that she can do.  As they were discussing this another agent walked by and said,
"Don't be doing deals that will cause another crash in market in three years."

The agent who had the buyer was very upset that the other agent had said this, and said, "I'm sorry I don't only work with high-end clients."

It got me questioning though, obviously this deal was going to be a tough deal for him to get his buyer funded.  In this slow market we all are desperately trying to save every deal and make them all work.  Not only for ourselves, but also to represent our buyers and sellers, but what if we are only setting ourselves up for another real estate crash. 

We are creating a cycle, by trying to jump start the real estate market again and getting all our buyers financing.  We are inevitably creating a future crash. 

I know personally I have done a few deals within the past month that my buyers barely qualified to purchase.  I'm sure that everyone is doing these deals.  I don't want to turn buyers away and I think everyone deserves the opportunity to purchase a home, but it's a double ended sword.



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Russ Ravary ~ Metro Detroit Realtor call (248) 310-6239
Real Estate One - Commerce, MI
Michigan homes for sale ~ yesmyrealtor@gmail.com
I don't think anybody would do that 502 score.  But if the bank approves a borrower without any fraudulent documents or stretching of the truth then I would do the deal.
Jan 09, 2008 10:01 AM #1
Joe Pecoraro
REMAX- Big Bear - Big Bear Lake, CA

Lenders are lenders and Realtors are Realtors.  All your associate can do is try to bring their buyer together with a seller.  He is going to the right person if he is talking to a lender. 

It seems to me that the agent walking by should worry about his own clients.

Jan 09, 2008 10:11 AM #2
Rosario Lewis
DDR Realty - Newburgh, NY
GRI, SRES - DDR Realty - Orange County, NY
I don't think it wise to base ones financial future on the hope of having a consistant, dependable income from rentals. What if one or more of the units goes unoccupied for a period of time? Disaster.
Jan 09, 2008 11:11 AM #3
Bruce Thomas
A-Z Tech Home Inspections, Inc. - Greensburg, PA


It's nice that you are concerned about the big picture, it shows integrity.  The way I look at it is, the lender has every opportunity to scrutinize the borrower.  They are doing the approval, not you.  If I had a shaky buyer I'd have them get pre-approved so you don't spend a lot of needless time.  In some cases credit repair my be possible.



Oct 05, 2008 09:12 AM #4
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Melissa.... I just recently go into a slight disagreement with a realtor on Trulia who says they only deal with borrowers with 20% or more down and who have cash reserves. He then when on to state that those helping buyers with FHA mortgages and only putting 3.5% down will be hurting the economy more... and he stated much more.  This irked me and I wrote about it.  In regards to your lender who was sitting with this borrower. I wonder what their input was.  Because not only do you have an issue with the credit scores, but even with someone buying a 3 unit or 4 unit has changed recently ... and is tougher... and different than if buying a duplex.  thanks

jeff belonger

Jul 11, 2010 03:56 PM #5
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Melissa Merriman

Realtor Greensburg PA
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