How Your Mortgage Company Can Put Your Offer at Risk

Mortgages are not commodities. The service your mortgage company provides is just as important as the interest rate. I hope the following story illustrates this point.

Last Thursday evening I received an offer on one of my listings. There was no mortgage pre-approval, so I called the buyer’s agent first thing on Friday. She didn’t have it, but said the mortgage company would fax it to me that day. I informed her that any offer would be subject to not only receiving a written mortgage pre-approval, but it’s verification by my office’s mortgage consultant, Mike Polera.

I wanted Mike to talk with the mortgage company because he knows what questions to ask to verify that the buyer is truly pre-approved. He is an expert in that area. I am not. I had a seller get burned in the past with an offer where the mortgage pre-approval wasn’t worth the paper it was written on, so since then I always have Mike follow up to verify the pre-approval.

I didn’t receive the mortgage pre-approval until after business hours on Friday. A verbal agreement was reached on Saturday. The buyer signed the modified offer on Sunday. I reminded the buyer’s agent that I would not have the seller sign the agreement until after the mortgage pre-approval had been verified. This meant nearly 2 days delay since we would have to wait until business hours on Monday for the verification. The buyer’s agent informed me that the buyer wasn’t happy with that, but I reminded her that the mortgage pre-approval could have been verified on Friday, if only we had received it sooner. Understandably, the buyer was concerned that in the mean time a better offer could be accepted.

Mike called the buyer’s mortgage consultant on Sunday and left a message for him to return his call. On Monday, a mortgage consultant’s assistant called me stating that the buyer was pre-approved thinking that was all that was needed. I asked her to call Mike which she did reluctantly.

I heard from Mike later that day that he was satisfied with all of their answers except one and was waiting to hear back on that one issue. He was told that he would get a call back before the end of the business day, but the call never came that day or even the next morning.

On Tuesday, Mike called the mortgage company and insisted on talking with the mortgage consultant who wrote the pre-approval. The mortgage consultant agreed with the issue that Mike raised and said he would discuss it with the buyer. Finally, I was able to give my seller the level of comfort she needed with the buyer’s financing.

The mortgage company put the buyer at risk for getting his offer accepted. They should have told him that he needed to submit a mortgage pre-approval with his initial offer. Even if they had faxed me the pre-approval first thing on Friday and responded promptly to Mike’s questions, there wouldn’t have been a delay in my seller signing the contract.