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When Buyers Select Their Own Lenders

By
Industry Observer with RETIRED / State License is Inactive Inactive License Oregon

When Buyers Select Their Own Lenders

The majority of clients ask for referrals.   Referrals to lenders, home inspectors, advice on escrow officers, title companies, etc. are part and parcel of what clients may request of their real estate agent.

Why? 

Most clients realize they don't have enough knowledge and experience working in real estate.  They turn to their trusted real estate agent for advice.  Referrals can be very valuable assets to our clients. 

Of the few that want to wing it, it almost always turns out to be problematic for them, in one way or the other. 

Today was a "case in point" day.

A recent client had selected her own lender and that's entirely fine by me.  However, a week prior to close there was a glitch . . . an oversight . . . a mild SNAFU . . . and it was the lender's oopsie.  It delayed closing for over a week as a result.  The seller was not very happy.  Even my client had to be inconvenienced when her move date had to be postponed.

The lender back-peddled because I refused to lie about why the deal was being delayed.  He sent out an email which contained the following:

"I wanted to provide a recent update on this closing and requirement for an extension. As those of us know active in the market, each closing and file is unique. Our goals and intentions are to hit every closing date, if set realistically for the lending market which is the driving factor for buyers and sellers."

Since when is the "lending market" the driving factor for buyers and sellers to set a close date?!? 

What a bunch of back-peddling hooey!  The lender gave the reason for our delay as:  "appraisal and appraisal delivery and receipt," even though the appraisal had been in two weeks prior

Today I received an email from the same lender.  Apparently, he didn't check his email contact list carefully enough, pulled in my email address and hit send.  I received an email that he inadvertently sent to my office, but wouldn't ya know it . . . he seems to be back-peddling on another transaction that needs an extension.

And the same excuses were given:  "there was a delay in the process on scheduling the appraisal and appraisal delivery and receipt" blah, blah, blah

Doesn't anything close on time out of this lender's office?!?

When there is earnest money on the line, Buyers need to be protected.  And sometimes, they need to be protected from their lender!   Can we say "early release of earnest money" boys and girls?!?  

Posted by

 

 

Carla Muss-Jacobs has RETIRED effective May 1, 2018

Representing Buyers in the Portland Metro Real Estate Market | Clackamas Multnomah and Washington Counties | Since 1999

Carla Muss-Jacobs, REALTOR®, ABR, CEBA, ePro
Principal Broker/Owner ~~ INACTIVE

Carla Muss-Jacobs' retirement became effective May 1, 2018

Direct: 503-810-7192 

 

All Rights Reserved © 

John McCormack, CRS
Albuquerque Homes Realty - Albuquerque, NM
Honesty, Integrity, Results, Experienced. HIRE Me!

Recently experienced the same thing. Not cool.   Lender didn't do what they were suppose to and so we had a delay. I didn't trash the lender to my buyer but I let the lender know it wasn't my bad and she needed to look at how she was handling or rather not handling business.  Grrrrrrrrr.......

Sep 12, 2012 07:09 AM
Anna "Banana" Kruchten
HomeSmart Real Estate - Phoenix, AZ
602-380-4886

Carla just heard yesterday of a closing that was delayed due to lenders negligence and the buyers lost the deal.  Seller submitted a 3 day cure notice of which buyer couldn't perform and they were out of the deal. Seller took the higher back up.   Do you think they're real happy with that lender?  Duh.  Our trusted lenders   are our trusted lenders for a very good reason....they get things done on time.

Sep 12, 2012 07:13 AM
Cindy Jones
Integrity Real Estate Group - Woodbridge, VA
Pentagon, Fort Belvoir & Quantico Real Estate News
Sounds like this lender has a line to push the blame to yet another party outside the transaction. Hope they get it together soon.
Sep 12, 2012 09:33 AM
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Hi John . . . I told my client I'd never refer him to anyone

Hey Anna B -- you know, I've always wondered about that too.  It never happened during one of my deals but who is to say that the back up offer isn't the highest and best and the sellers are just waiting for one oopsie to breach the contract and BAM, back up buyer gets in!  I think this post is a CAUTIONARY TALE.

Hi Cindy . . . it's a line all right! 

Sep 12, 2012 09:46 AM
Jane Peters
Home Jane Realty - Los Angeles, CA
Los Angeles real estate concierge services

This is a great reason for buyers to make sure they are dealing with a known and proven lender, because they are the ones who are going to suffer in the end.

Sep 12, 2012 10:40 AM
Kathy Sheehan
Bay Equity, LLC 770-634-4021 - Atlanta, GA
Senior Loan Officer

What exactly did the lender fail to do in a timely fashion?

Sep 12, 2012 11:39 AM
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Tomorrow I call a lender and fling a fit myself.  It actually IS the late appraisal that will cause us not to close by contract date.... BUT this appraiser does this ALL the time and while lenders can't order appraisals they certainly can tell the AMC to NOT use X because he NEVER meets deadlines.  Appraisal in my case was ordered on August 31 and TODAY appraiser called to get code... WTH?  Again, like in your case, NOT the lender I recommend.

Sep 12, 2012 01:54 PM
Kathryn Maguire
GreatNorfolkHomes.com (757) 560-0881 - Chesapeake, VA
Serving Chesapeake, Norfolk, VA Beach

I had this happen a few months ago from a loan officer at a monster mega bank that was selected by my buyer.  One week before closing, they could not fund the loan unless some new legal documents were produced regarding her legal separation (this was someone putting 50% down and had her father who owned his own home outright co-sign). I brought in one of my lenders.  He got it closed on time.  The original loan office called my client, said they could actually fund the loan, please come back, she was going to get in trouble with her supervisors, yadda yadda yadda. Lenders can KILL a deal!

Sep 12, 2012 10:00 PM
Debb Janes
Nature As Neighbors - Camas, WA
Put My Love of Nature At Work for You

Sounds like a lot of hooey is right Carla. Not sure this guy should be in business if he doesn't have the ability to meet deadlines while working multiple transactions...after all, that's the name of the game. Bummer.

Sep 13, 2012 12:12 AM
Francine Viola
Coldwell Banker Evergreen Olympic Realty, Olympia WA - Olympia, WA
REALTOR®, In Tune with your Real Estate Needs

I love your High Horse Award!  Maybe you could "inadvertently" send that award to the lender.  It's frustrating for us because we work hard to get the deal together and get it to stay together, then someone else messes up the whole process that causes a lot of unnecessary financial and emotion stress.  But at least your transaction can close.  I love the lenders, and it just happened to me last week, where on the day of closing tell the buyer that they aren't qualified for the loan. You should hear the back-peddling then!

Sep 13, 2012 03:16 AM
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Hi Jane . . . with a high-demand listing and back-up offers being submitted after the pending status, lenders should be very pro-active.

Hey Kathy -- take care of business.

Hi Tammy . . . hope it all works out timely.

Hey Kathryn -- I've seen early release of earnest money to sellers when the deal hasn't closed, I've seen back-up offers come in to play when the deal hasn't closed, etc. 

Hi Debb . . . he'll stay in business, but won't get mine

Hey Francine -- how can a lender tell a buyer on the day of closing??  I'm very curious on that, what happened??

Sep 13, 2012 07:52 AM
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Oh boy.  Where to start.  I agree with you that it's "hooey" if the appraisal was in and the ball was dropped.  I also agree that the lender should have owned-up to the problem, or forewarned that there might be issues much earlier in the transaction.  Bad lending happens.

#%&@ happens too.  And that is where you weed out the good lenders from the hacks.  Everyone makes mistakes.  Everyone has #%&@ happen to them.  But the bad lenders don't 'fess up to it or they lie.  The good lenders admit their mistake and take the heat.  THAT is the big difference ... and a very important one.  Good lenders also don't continually have the same problem.  Or at least, not for long.  They find another company or bank to go to work for that will give them the support they need.  No lender wants to be put in that position on a continuing basis.  Believe me.

I do want to say I find your comment about clients asking for referrals interesting.  Because it's exactly the opposite of what I hear from agents here in the Midwest.  They tell me the great majority of their clients come to them pre-qualified/approved.  Locale difference??  But I'm glad you have a "team" that you refer, Carla.  Exactly what I would love to work with in a professional sales person ...

Glad you commented on my post ... I would have caught this eventually.  But glad it was sooner than later ...

Gene

Sep 13, 2012 08:55 AM
Brenda Mullen
RE/MAX Associates - San Antonio, TX
Your San Antonio TX Real Estate Agent!!

We are definitely here to protect our buyers interests and when the lender is at fault it's a major problem.  I am with Gene above, a Good Lender will admit their mistake and FIX it...not back peddle and make excuses.  

Sep 13, 2012 12:01 PM
Eve Alexander
Buyers Broker of Florida - Tampa, FL
Exclusively Representing ONLY Tampa Home Buyers

OH, I think I need your high horse certificate...

Eve in Orlando

Sep 14, 2012 08:38 AM
Susan Haughton
Long and Foster REALTORS (703) 470-4545 - Alexandria, VA
Susan & Mindy Team...Honesty. Integrity. Results.

I, too, am finding more and more clients coming to me having already been prequalified and most of the time, they have been prequalified by someone local who is known to do a great job. Every once in a while, though, you get the "oh, boy," prequalified and you know you have your work cut out for you. I have no problem telling clients about my previous experiences with a lender they have chosen, all the while reassuring them they have the right to work with whomever...however... ;-)  

Sep 14, 2012 11:47 PM
Lori Cain
Own Tulsa - Tulsa, OK
Midtown Tulsa Real Estate Top Producer

If I don't know the Lender or can't verify with someone who has worked with the Lender, I ASK my Buyer to choose from my Preferred Lender list - six choices. I don't necessary relate horror stories, but I do give a vague explanation of why it's important to use a local Lender with a track record!

Sep 19, 2012 02:49 AM