Last Friday after a disconcerting phone conversation with a buyer’s mortgage broker, I wrote “A Mortgage Pre-qualification is Worthless as Part of an Offer“. The mortgage broker tried to get me to accept a mortgage pre-qualification for inclusion with my buyer’s offer. I insisted on a mortgage pre-approval. Any good listing agent receiving an offer with only a mortgage pre-qualification would advise her seller that a pre-qualification provides no proof that the buyer can be approved for a mortgage. Thus, accepting such an offer is risky.
The mortgage broker’s lack of professionalism during our phone conversation also concerned me. He spoke so fast I couldn’t catch his last name or his company’s name. When I remained firm on a mortgage pre-approval, he became sarcastic and abruptly ended the conversation.
Home buyers and sellers are free to use whomever they want for a mortgage broker, real estate attorney, home inspector and other professionals involved in the home sale or purchase, so I hesitated to say anything to my client. However, I was concerned that additional problems would arise. I had a similar feeling after talking with another client’s real estate attorney last year. The deal fell through during the attorney review and inspection period.
I’m pleased to report that today my buyer informed me that he will be shopping for another mortgage broker. During further discussions between the mortgage broker and my buyer some “inconsistencies” arose. My buyer made the smart choice and walked away.
There are plenty of people in real estate that are honest, hardworking and professional. Don’t settle for anyting less.
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- A Mortgage Pre-qualification is Worthless as Part of an Offer
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- How Your Mortgage Company Can Put Your Offer at Risk
- Don’t Use Your Family Attorney for a Real Estate Transaction
- I’ll Be More Careful When Recommending Real Estate Attorneys!
{ 2 comments… read them below or add one }
Great article. Many shoppers take what they are told as truth without seeking a second opinion. We have a group of real esate and mortgage calculators that may help determining pre-qualification of a mortgage.
Buyers often don’t know the difference between “pre-qualified” and “Pre-approval.” However, realtors and mortgage brokers certainly do! The real estate professionals with whom you deal ought to be able to steer you clear to what is really needed (pre-approval) and do the necessary steps to get you there. If you haven’t been asked for your social security number (with which to pull credit) or documentation (income, asset verification) you’re not being given a TRUE pre-approval, and, as Fran notes, you’re being misled. Pre-approvals are serious and require input from you. Because of that they have worth – essentially, you have given the mortgage officer enough information for her to be able to pre-approve you based on lenders guidelines. This gives you an advantage in negotiating for property. AND it gives you a head start on the mortgage process – the paperwork you submit for pre-approval is some of what will be needed for underwriting the loan. So it’s to your advantage, doubly, to get a REAL pre-approval.