I Don't Like it One Bit, but I Don't Guess I Can Do a Thing About It

By
Real Estate Agent with McGraw Realtors

Common Sense?Let me begin this post by saying up front that I am not a foreclosure Realtor specialist.  While I do list and sell some foreclosed properties, they aren't my focus and/or speciality.  Thankfully, in Oklahoma we don't have that many foreclosed properties and most of the foreclosure market was snatched up long before I ever would have had a shot at it.  I'm sure there's lots about foreclosures that I am woefully ignorant of and simply do not know.  Maybe that is a good thing.

With that having been said, there is a new wrinkle I'm beginning to see in our foreclosure market.  It goes like this..."Bank of America approval required..."

The first time I saw it, I had to go back and read it again.  Then I called the listing agent who told me that while my buyer didn't HAVE to go through Bank of America, they would have to talk to the Bank of America loan guy and go through a simple application and approval process to buy the house.

Needless to say, when I spoke with the actual loan officer about this new wrinkle on the landscape, he was none too pleased.  After doing what we felt needed to be done to protect our buyer, we sent her off to have her visit with Mr. Bank of America loan guy.  A day or so later he told us that she smelled okay and that when he frisked her, she wasn't hiding any bad credit scores anywhere and that she would be okay to buy the house.  Whew!  That sure made us feel better about our previously pre-approved client!

We already deal with being forced to use closing companies not of our choosing, which I believe is...uh...illegal or something like that.  Now, we have to get a second approval from Bank of America in order to buy one of their foreclosed properties?  Seriously?

I supose Bank of America is so smart that they no longer trust any other Mortgage company on the planet to be able to do their job.  Or maybe they just are over reacting to the housing market crash.  Or maybe they're just that good.

Whatever it is, I don't understand.  And I don't appreciate it either.  And neither has a single client I've worked with who has had to jump through their little special "come and talk to us" hoop.

Real Estate Foreclosures.  Grrrr.

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Rainer
77,754
Andy Kress
Rental Solutions Oahu

I agree. Wells Fargo and Chase are doing the same thing.

November 11, 2010 06:23 PM
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Bob Haywood
www.BobHaywood.com
McGraw Realtors

Michael - makes you feel like we live in the old Russian society where nothing made sense, doesn't it?  (At least that's what I've been told)

Andy - It's nutso!

November 11, 2010 06:26 PM
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Lenn Harley
Real Estate Broker - Virginia & Maryland
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate

Of course they're clearing buyers.  Who can blame them considering the worthless "approvals" that agents present.

Further, we look on these requirements as an opportunity.  If they want to "clear" our buyer and make them a financing offer they can't refuse, why fight it?? 

OUr job is to get the best house, best financing for our buyers.  If BofA wants to beat the market, find with me. 

This is nothing new.  I've known listing agent who reqired a credit review by a trusted lender for 20 years. 

November 11, 2010 06:31 PM
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Bob Haywood
www.BobHaywood.com
McGraw Realtors

Lenn, thank you for stopping by and commenting.  I guess not being used to the foreclosure market, I get a bit possessive and afraid they're trying to pull my buyer away from their selected loan company.  We see this with new construction...

November 11, 2010 06:38 PM
Rainer
207,065
Gerard Gilbers
Your Marketing Master
Stingray Performance Marketing

Unfortunately with a foreclosure, the bank that owns it seems to be able to make the rules. i have seen that with several banks as Andy mentioned.

November 11, 2010 06:47 PM
Rainmaker
409,412
Michelle Francis
Realtor, Buckhead Atlanta Homes for Sale & Lease
Tim Francis Realty LLC

Bob, 

I agree, I found this totally obnoxious the first time I saw it.  We have had some that require you to use their mortgage company... or want you to.  It seems totally offensive. 

On the flip side, if buyers are not really qualified, the sellers want to know sooner than later, so I do realize why they are doing this.  There is no reason a home should actually go under contract if the buyers really can't buy it. 

It's a crazy wild ride we are on.

All the best, Michelle

November 11, 2010 07:17 PM
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Debe Maxwell
Charlotte Homes for Sale - Charlotte Neighborhoods
www.AtHomesCharlotte.com | Savvy + Company Real Estate

Hi Bob!  We get this all the time here and have for years.  Sometimes we even encourage our buyers to get their pre-approval from the bank holding the short sale or foreclosure, even if the bank doesn't require it.  The reason we do that is so that if we're in a bidding war, the bank will have the confidence that one of 'their own' actually is the one who provided the pre-approval and look more favorably at our buyers.  It works too!

November 11, 2010 07:51 PM
Rainmaker
1,590,399
Dorie Dillard
Realtor-Canyon Creek- NW, Austin TX Homes For Sale
Coldwell Banker United Realtors

Good evening Bob,

Debe is right..encouraging the buyer to take the step up front of getting pre-approved with the bank holding the short sale or foreclosure is actually acting in the best interest of your buyer..you could end up a notch ahead of someone else making an offer. If they can give your buyer the best deal than you have accomplished your goal..getting the home of their choice and obtaining the best price and financing for your buyer!

November 11, 2010 09:29 PM
Rainmaker
1,237,048
Gene Riemenschneider
Turning Houses into Homes
Home Point Real Estate

Get used to it.  It happens all the time around here.  The is one advantage, when things get screwed up you can point the finger at them, their Agent, their escrow company, their bank.

November 11, 2010 10:12 PM
Rainmaker
494,751
Lora "Leah" Stern 914-772-4528
Real Estate Salesperson
Coldwell Banker, 170 N Main Street, New City NY 10956

Bob, I personally don't see anything wrong with it.  Not all pre-approvals are equal and if the seller wants to make sure that the buyer is viable and finds more comfort in having them pre-approved by their lender of choice, then that's fine by me.

November 11, 2010 10:58 PM
Rainmaker
183,714
Wanda Thomas
Billings Montana Real Estate
Montana Homestead Brokers, Broker, CRS, GRI, SFR, RN

This is a bit uncomfortable isn't it?  It's hard enough for some people to give their information to their lender, then to have to give up to someone else!

However, since I've been faced with BS pre-approvals from places I've never even heard of, I can sure understand this.  I look for local lender pre-approvals to bring offers and when I receive them.

November 11, 2010 11:23 PM
Rainmaker
407,597
The Scott Loper Team Lansdale & Harleysville PA Homes
Keller Williams Real Estate - Montgomeryville

Hi Bob,

We don't see that very often in our area but I have found the comments very interesting and insightful.  Thanks for covering the topic.

~Lisa

November 12, 2010 11:01 AM
Rainmaker
631,985
Dawn A Fabiszak
The Dawn of a New Real Estate Experience!
Keller Williams Real Estate ( Denver metro area, Colorado

Bob ~ like the government, you have to jump through the hoops if you want to get the deal done.  We are playing on their ball field.  As Andy stated, Wells Fargo and Chase do this as well.  I know they have been requiring it for quite a while.

November 12, 2010 09:38 PM
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Bob Haywood

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