How did you pick your lender?

[Anonymous]

Real estate agent is recommending choosing a lender before entering a contract. So we don't have a lot of time to shop. She recommends against the big banks and has a few of her own recommendations. Is this par for the course? Is it risky to follow her recs? How do you find out more about different companies? Or does it all really boil down to the same thing and the rate is what matters?

[Anonymous]

You don't need to have a lender lined up before entering a contract, but you will need one about 30 days out (the sooner the better). So if you are trying to close quickly, having the lender in place before contract will help. You do need a pre-approval letter before entering a contract, however any lender can provide this and you do not need to close with said lender.

Sometimes, realtors get a kickback if their client uses a particular lender - I'd ask this question.

In the end, you want the best rate and the easiest transaction. It may be that the realtor's lender will provide both of these. At the same time, being that the realtor and lender work together, they have a mutual interest in the deal going though, which is not always in your best interest.

Also, find your own home inspector.

[Anonymous]

A seller won't even look at your offer without a pre approval letter. Big banks are not the best for loans I would go with a broker lender that eventually sells your loan to a big bank.

[Anonymous]

We have preapproval from our (big) bank. Because this is a multibid situation agent is saying we will not have the normal 30 days after contract is signed to shop, hence why we are trying to do so now. Appreciate some of the tips. Anyone have specific recs?

[Anonymous]

When we bought 10 years ago, we used the lender our agent recommended. Fortunately, it worked out, and we have used her twice since then. She's been amazingly responsive.

If your agent recommends someone, check him/her out and see if you get a good feel. Have enough knowledge of rates, etc., that you can judge if he/she is offering you something good. Make sure he/she is responsive, answering all of your questions and guiding you through the process.

Technically, you can switch after the pre-approval, but you will already have submitted so much paperwork that you probably won't want to. So try to find someone decent to start with.

[Anonymous]

Sometimes, realtors get a kickback if their client uses a particular lender - I'd ask this question.

Feel free to ask, but the answer will be no, since that's illegal.

[Anonymous]

Get a pre-approval letter with her lender and in the meanwhile shop around for the best rate. Ours did that too and was very angry when we went with a different lender with a far better rate. I think they get some kind of perk/kickback too depending on the person and company.

[Anonymous]

Anonymous wrote:

Sometimes, realtors get a kickback if their client uses a particular lender - I'd ask this question.

Feel free to ask, but the answer will be no, since that's illegal.

Illegal if you call it a "kick-back" maybe. Our lender told us that our realtor's brokerage is the only one they deal with that doesn't get a "realtor fee" in closing. ie, there is often a fee (in our good faith estimate it was around $800) that goes to the realtor. It's a fee in closing, not a kick-back technically. But it could act as one. It's worth asking about. I liked the fact that our agency didn't ask for it.

[Anonymous]

oh, and to answer the question, we got recommendations for a lender from our realtor, from friends, and also asked our credit union. We chose the one with the best rate, who turned out to be the one the realtor recommended. I think you can trust your realtor's recommendation in terms of the lender's effectiveness, speed, and service, because their interest is in having the transaction go smoothly. They are not as interested in you in getting you the best rate, though, so for that you just have to shop around.

[Anonymous]

The flat fee is usually around $300, and if that agency is having their exorbitant flat fee paid by the lender for steering clients toward them that is not kosher.

[Anonymous]

Anonymous wrote:

Sometimes, realtors get a kickback if their client uses a particular lender - I'd ask this question.

Feel free to ask, but the answer will be no, since that's illegal.

This is true for some builders.

[Anonymous]

I went with my RE agent rec. The house I bid on was a multi-bid situation and they wanted to close fast- less than a month after contract!

The guy was fine, rate I got was acceptable but definitely not the lowest I could have qualified for (3.875% in Late March/early April of this year.)

Occasionally wish I had looked more, but with how tight our timeline was- I really may have lost the house if the loan officer wasn't responsive & fast, and ultimately mine was.

[Anonymous]

Anonymous wrote:I went with my RE agent rec. The house I bid on was a multi-bid situation and they wanted to close fast- less than a month after contract!

The guy was fine, rate I got was acceptable but definitely not the lowest I could have qualified for (3.875% in Late March/early April of this year.)

Occasionally wish I had looked more, but with how tight our timeline was- I really may have lost the house if the loan officer wasn't responsive & fast, and ultimately mine was.

Same situation here. Had to close fast and did in less than 4 weeks including thanksgiving holiday.

[Anonymous]

Most real estate agents recommend certain lenders b/c they have a lot of experience closing with them and know they can get to closing. So it makes sense to consider what they say.

[Anonymous]

I like first savings mortgage. Recommended by our agent. Very efficient, no surprises or delays in closing. It was a three week contract period.