Pre-Approval's are they worth the paper there printed on?

By
Mortgage and Lending with Prosperity Home Mortgage

Realtors do you take the time to interview the loan officer who's pre-approval is with the buyers offer to purchase prior to submitting that offer to your sellers ? 

The cold hard, being a loan officer today requires much more than taking a loan application, running credit, presenting the rates & fees to the client and if they agree to move forward, handing it off to a processor.
A huge part of being a loan officer today is educating oneself on the ever changing guidelines that can effect the out come of a loan program and properly interviewing prospective clients prior to issuing their pre-approval. This for me anyway insures that they are qualified to purchase with no contingencies or what if's, which in my mind today is no longer a formality its a requirement. For me issuing a pre-approval to a client who is buying a home puts my name and reputation on the line and because my business is built on the trust and confidence my referral partners put in me, I take my business very seriously.

At the end of the day I am responsible for protecting the interests of all those involved in that transaction by providing the financing that I said my client was qualified for on my pre-approval.

Questions I encourage my Realtor's to ask, privacy issues do not allow specifics to be answered however I always give ranges:

  • What are the buyers credit score ranges. 
  • Does their credit score qualify them for this loan program.and loan to value.
  • Are their debt to income ratios in line with the loan program you qualified them for.
  • Do they have a 2 yr job history. ( not always required but a good thing to know)
  • Did you review their income documents, (very important if self employed to review tax returns)
  • Did you review their asset documents.
  • Is there anything you can see that would prevent these buyers from closing as scheduled on this property. ( except for appraisal or title related issues)
  • Will you inform me right away if you encounter any red flags at all.

While I a sure there are many other questions you might ask, these are what I feel backs up the words on that document we call our pre-approval.

Best Regards,
Bob

Posted by

 

Bob Basmajian

Senior Loan Officer

NMLS# 557858

Oak Mortgage Company

609-654-6131-direct

609-636-0039- text me

856-282-1216- secure fax

bbasmajian@oakmortgageusa.com

www.bankhomeloans.me 

 

Holding ethics and responsibility
to my clients, above all else

 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Dan Edward Phillips 06/21/2010 01:33 AM
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Show All Comments
Rainmaker
345,013
Rodney Mason
Prospect Mortgage - Atlanta, GA
FHA 203K, USDA, VA, HomePath Renovation Specialist

It's amazing how many loan officers will still issue a Pre-Qualification/Pre-Approval letter without ever seeing a pay stub, W-2, tax return, or bank statement.  Everyone is this business knows that what the buyer says rarely ever matches what can actually be verified.

Jun 14, 2010 10:55 PM #1
Rainer
51,767
David Okada
Prudential Douglas Elliman - Manhattan, NY

Bob,

You address some good points in your blog. I try to be as thorough as possible by reviewing their financial statements, which I always ask for regardless of the preapproval loan.

Jun 14, 2010 10:58 PM #2
Rainmaker
137,264
Kellie Morrissey
Keller Williams Realty Success LLC - Littleton, CO
CO Realtor CRS, GRI, CDPE

I have become much more strict about getting my buyers to speak to lenders early on the home search process.  I will give the 3 times to look at homes after that if they don't sit with a lender I will not take them out again.

Jun 14, 2010 10:59 PM #3
Rainmaker
238,540
Matt Grohe
RE/MAX Real Estate Concepts - Des Moines, IA
RE/MAX Des Moines

Bob: Those are great questions and it would be helpful to know the answers, but I'm not optimistic I could get them answered.

Jun 14, 2010 11:04 PM #4
Rainmaker
584,926
Dan Edward Phillips
Dan Edward Phillips - Eureka, CA
Realtor and Broker/Owner

A pre approval letter is very important to the seller if it comes from a reputable mortgage broker.  Nice blog!

Jun 15, 2010 12:15 AM #5
Rainer
81,102
Wade Kawahara
Dominion Real Estate Partners, LLC - Phoenix, AZ

If I have a contract, before I have my seller make any decision I always call the loan officer.

Jun 15, 2010 01:20 AM #6
Rainer
16,594
Bob Basmajian
Prosperity Home Mortgage - Medford Township, NJ
Home Loans-NMLS# 557858

Hey Matt, If you not getting the answers to those questions, time to look for another loan officer.

 

 

Jun 15, 2010 10:09 PM #7
Rainer
16,594
Bob Basmajian
Prosperity Home Mortgage - Medford Township, NJ
Home Loans-NMLS# 557858

Kellie, I like your approach.

 

 

Jun 15, 2010 10:11 PM #8
Rainer
16,594
Bob Basmajian
Prosperity Home Mortgage - Medford Township, NJ
Home Loans-NMLS# 557858

Rodney, I have seen my fair share of those pre-approvals, some of which never make it to the closing table. Sat across from a Real Estate Attorney in my closing today discussing this very subject.

Jun 15, 2010 10:15 PM #9
Rainer
16,594
Bob Basmajian
Prosperity Home Mortgage - Medford Township, NJ
Home Loans-NMLS# 557858

Thank you Dan,

Jun 15, 2010 10:15 PM #10
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Rainer
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Bob Basmajian

Home Loans-NMLS# 557858
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