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The AZ Grand Canyon in Home Buying

By
Real Estate Agent with Dirt Road Real Estate SA676002000

Here in AZ, our state association has created many “Lawyer approved” forms which allow for consistency in real estate transactions.  Unfortunately, many lenders fail to adhere to one form which creates for potential buyers literally a Grand Canyon and often derails the offer. Let me explain.

The AZ AAR Residential Resale Real Estate Purchase Contract does require on page 02, line 69 the submission of an AAR Pr-Qualification Form attached to the actual contract. Unfortunately, many buyers fail to understand the importance of this form as do their lenders.

During the initial intake interview with a potential real estate buyer, I always inquire is this purchase going to be cash or a loan.  When the response is a loan, I then share how the AZ residential purchase real estate contract requires the submittal of a Pre-Qualified Form. Frequently, I send a sample of that form to the buyer or buyers to forward to his, her or their lender.

Local lenders here in NW AZ, Mohave County, have no issues in completing this form. Often, I receive this form ahead of any offer to purchase residential real estate. By having this in hand, I can confirm the buyer's budget and not share homes beyond their budget. 

Many times, the form is actually pre-approved instead of just pre-qualified. This “Pre-Qualification” form allows for the lender to check various documents have been received and reviewed. Now the home loan applicant is pre-approved. Additionally, if the offer is received, the second page provides for a loan status update that is updated as the loan application goes through the lender’s lending process.

Being Pre-Approved Is a Competitive Advantage

for Any Buyer or Buyers

By not having this required document, puts the potential buyer’s offer on one side of the Grand Canyon. The lack of this document may prevent the offer from being presented or the listing agent will call attention to the absence of this document. What then happens is the real estate purchase offer is rejected or countered with a request for the pre-qualification form to be attached. Regardless, the home buyer or buyers may lose his, her or their ideal home because the lender failed to adhere to a simple request and requirement.

P.S. Several of our local lenders can actually do a “soft credit” pull that does not affect the credit rating of the loan applicant. This is another reason to work with a local lender instead of a lender who is licensed in the State, but is physically located in another state.

Starting the process by "just browsing" could set you up for heartbreak. Before you go looking for (and falling in love with) a home, you need a realistic idea of what you can afford, make sure your credit is in good shape, and, most importantly, get pre-approved for a mortgage. If you're unsure where to start, you're in luck! I know some of the best loan officers around, and working with me means my connections are your connections! #thehelpfulagent #home #houseexpert #house #listreports #homeowner #househunting #realestate #realtor #realestateagent #themoreyouknow #mortgage #investment #happyhomeowners #icanhelp

Feature Photo Courtesy of ListReports.com

Any reproduction of Leanne M Smith’s blog for use by any AI or GAI, distribution or reproduction including but not limited to electronic newsletters e.g. PDF’s Internet sites or physical products e.g. newspapers, CDs without prior written permission and consent by me, Leanne M. Smith (Leanne Hoagland-Smith) is strictly prohibited.

Posted by

Leanne M. Smith, MS, GRI, rCRMS

2018 KGVAR Rookie Realtor of the Year-55+
219.508.2859 MST
Life Begins Where the Pavement Ends
Connect with me on LinkedIn:
http://www.linkedin.com/in/leannehoaglandsmith
Nick Vandekar, 610-203-4543
Realty ONE Group Advocates 484-237-2055 - Downingtown, PA
Selling the Main Line & Chester County

A great explanation of how not having the right form and the right lender can impact a buyer from achieving their goals. One of the benefits of a buyer consultation to begin the whole process.

Apr 16, 2024 07:30 AM
Leanne Smith

How true are your words Nick Vandekar, 610-203-4543 Working through a loan assumption with an out of state lender who has no sense of urgency,

Apr 16, 2024 07:50 AM
Bill Salvatore - East Valley
Arizona Elite Properties - Chandler, AZ
Realtor - 602-999-0952 / em: golfArizona@cox.net

 Great information. Thanks for sharing and enjoy your week!

Bill Salvatore, Realtor- Arizona Elite Properties

Apr 16, 2024 07:59 AM
Leanne Smith

Thank you for stopping by and good morning.

Apr 16, 2024 08:01 AM
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Prop. Mgr, Wenatchee, WA

Hi Leanne,
I think it's great that the real estate PSA in Arizona requires a Pre-Qualification. I don't know if Washington has gone to that.  If not, they should.

Apr 16, 2024 08:07 AM
Leanne Smith

The AZ Constitution allows for licensed real estate agents to write contacts, limited law practice. The forms supplied by our state association are top notch and always under review as in the recent instance of the Real Estate Agency Disclosure and Election (READE).

Apr 16, 2024 08:10 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Someone else posted this almost word for word and all I could say was AMEN:)Endre

Apr 16, 2024 09:43 PM
Leanne Smith

Really, almost word for word, please do share? Thank you for comment.

Apr 17, 2024 07:11 AM
Patricia Kennedy
RLAH@properties - Washington, DC
Home in the Capital

Leanne, it's also important to include proof of funds if the buyers are not getting a mortgage loan. 

Apr 17, 2024 06:41 AM
Leanne Smith

Good morning and that is also included in the AZ Residential Purchase Contract, page one, lines 19 and 20.

Apr 17, 2024 07:10 AM
Cara Marcelle Mancuso
Golden Girls with SW Desert Homes - Tucson, AZ
Call a Marana neighbor, I'm THERE!

Great reminder and I loved the analogy.  I received an offer ten days past from and agent/buyer and he sent a pre-qual LETTER!  Sigh.  My first thoughts were, "Oh, I can hardly wait for the BINSR".  And then I looked him up to check his experience so I could temper my responses.  :)

Apr 17, 2024 07:12 AM
Leanne Smith

Hopefully he was not part of a team where his transactions are invisible. Thank you and good morning.

Apr 17, 2024 07:23 AM