Chances of buying an REO or short-sale without 20% down?

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Submitted by Scarlett on January 5, 2009 - 4:20pm

Is there any point in even looking to buy an REO or short sale if you don't have 20% down at least?.

For example, with only 10% down, but with excellent credit, steady income and good debt-to-income ratio. Does anybody know of any success stories in this regard? If not, do you think that with more and more foreclosures, in the future, those chances will increase?

Thanks,
Scarlett

Submitted by Eugene on January 5, 2009 - 4:54pm.

I think you're conflating three issues. 1) Can you get a mortgage with 10% down? 2) Will the bank agree to sell you the house with 10% down? 3) Is it wise to start shopping for a house if you only have enough money for 10% down?

1) Yes, but it will be more expensive than if you put 20% down.

2) Yes, but, all else equal, the bank may prefer the buyer with larger down payment.

3) Probably not - houses are still going down - it's possible that your house will drop 10% and wipe your down payment. Don't spend your last dime on the down payment.

Submitted by urbanrealtor on January 5, 2009 - 4:54pm.

Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.

I really see the cash component come into play here when its like all cash. And that's for reo's.

The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.

Submitted by Scarlett on January 5, 2009 - 6:07pm.

esmith wrote:
I think you're conflating three issues. 1) Can you get a mortgage with 10% down? 2) Will the bank agree to sell you the house with 10% down? 3) Is it wise to start shopping for a house if you only have enough money for 10% down?

1) Yes, but it will be more expensive than if you put 20% down.


Thanks, esmith!

That depends, of course, - in the sense that if one has more than 10% to put down, and if he prefers to invest some of it, instead of putting everything for a downpayment, it may actually pay off, or at least be a safer investment, in case the prices drop further (which looks almost a certainty right now).

esmith wrote:

(...)
3) Probably not - houses are still going down - it's possible that your house will drop 10% and wipe your down payment. Don't spend your last dime on the down payment.


No, I wouldn't spend my last dime, and probably I wouldn't be getting a good loan deal if I did. But saving another 10% down payment or 50-60K may take years and years, realistically (in my case). In the mean time, with kids, it's nice to have a larger house & yard while they are still young. I didn't mean that I would buy something right away, but perhaps in the next year or two - hopefully by then the prices would have reached their last/bottom leg in areas I am looking.

Submitted by Scarlett on January 5, 2009 - 6:14pm.

urbanrealtor wrote:
Thats most of my clients right now.

Good credit, good pay, but low savings (like 5-10 percent).

Not always the best position to get low offers accepted but totally reasonable.
(...)
The shorts seem to only care that they have a patient buyer (I am listing a few) and that the lender is legit.

If you have more detailed questions (like too detailed for a thread), you can also email. Its my handle at gmail.

Aha, I was wondering how many are in my situation...I knew some of my friends were...
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

Submitted by SD Realtor on January 5, 2009 - 6:16pm.

My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

I know with kids and a family it is hard to be patient especially if it means another year or two.

Submitted by Eugene on January 5, 2009 - 6:28pm.

Scarlett wrote:

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

I don't think that success with short sales depends at all on the amount you put down.

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

Submitted by urbanrealtor on January 5, 2009 - 6:42pm.

Scarlett wrote:

Aha, I was wondering how many are in my situation...I knew some of my friends were...
Thanks, Urbanrealtor! I may contact you in the future.

In short sales succes stories with <20% down, what was crucial factor for success? For example, the speed at visiting the property after it hit the MLS & making a decision & offer - how long was that? Other factors (beside the pre-approval with a serious lender)?

I would keep an agent on retainer who knows your desires (as far as area and price and features). I would then do much of the work yourself. Check sdlookup daily and let the agent do work as well.

Responding quickly to cheap reos and shorts is important. Often I go to write up an offer on a compelling situation only to find it has gone pending in the last hour.

If the numbers make sense (and you should know your numbers before acquiring your target) pull the trigger that day. Sometimes the reo agents will put up road blocks (eg a preferred lender prequal, absurd addenda with offer) but a good agent will know how to deal with those.

Also, short sales require lots of patience. The seller's bank can take months after seller acceptance to give approval. Some clients make offers on short sales and keep looking. Since shorts generally don't require a deposit for acceptance, it does not automatically tie the buyer's hands for the time spent negotiating with the seller's lender. The buyer can still look around.

Again, I think the biggest disability of sub 20 buyers is the inability to structure a cash-heavy lowball. You simply don't have the ability to make funding a sure thing every time.

Submitted by Scarlett on January 5, 2009 - 6:48pm.

SD Realtor wrote:
My thoughts are that if your offer is the highest of all the offers out there then it does stand a good chance of being accepted, especially for an REO. I have an all cash buyer who has been outbid on a few homes already for REO properties in Eastlake by non all cash buyers. If the difference is only a few thousand then of course you are in peril. For shorts your position is weaker because when you submit your offer you may be the highest amount but while the processing is getting done another offer can come in at your bid amount and if they have less financing then they will more then likely get the nod.

It seems that one may compensate for less downpayment by coming at above the asking price and hoping for the best.

How much higher you see the accepted offer, for REOs and short sales (percentage in regard to listing price)?

SD Realtor wrote:

I agree with UR in that people are still out there buying with 10% down.

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.


I don't think it works quite that way, if you need to put 20% down... E.g. a house of 550K (my price range) - 20% down is 110K. With 10% drop in the price, 20% down is still close to 100K... which is still far from 82K (15%)... I actually need a drop of 27% in price for that 15% of the inital price 550K to become 20% of the actual price - it may or may not happen (I think it will).
Anyway, waiting for many years (>5) to save the 15-20% down will probably get me higher mortgage rates than todays with 10% down, and maybe even higher house prices (eventually, it could happen in the number of years it would take me to save the another 30K down payment - at least I'd be sure we have passed the bottom).

SD Realtor wrote:
I know with kids and a family it is hard to be patient especially if it means another year or two.

That's very true :) But we will be patient at least another year, rather than doing something risky. We are renting in a place with ultra-short commute, in UTC, and if we buy a house (in PQ, CMR), it will definitely mean a significantly longer commute. So with that in mind, we find the patience to wait (we HATE commuting in the rush hours!).

Thanks!!!

Submitted by Scarlett on January 5, 2009 - 6:53pm.

esmith wrote:

If you want to get a short sale, you need to make an offer that is low enough for you to like and high enough for the bank to approve, and you need to stick around long enough for your offer to make it through the system.

What exactly do you mean by 'sticking around long enough for your offer to make it through the system'? What does one have to do, after submitting an offer? Sorry, I have no knowledge of how the short sales work - yet!

Submitted by FormerSanDiegan on January 5, 2009 - 7:01pm.

SD Realtor wrote:

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

Not sure the lender would apply the same interest rate and relieve the buyer of PMI though. So, it's not really 20% down.

But a good point, nonetheless.

Submitted by Scarlett on January 5, 2009 - 7:02pm.

urbanrealtor wrote:

I would keep an agent on retainer who knows your desires (as far as area and price and features). I would then do much of the work yourself. Check sdlookup daily and let the agent do work as well.

Ah, I am good at doing a lot of work, and watching the new listings on various websites. Did that succesfully when I bought my first house.

urbanrealtor wrote:

Responding quickly to cheap reos and shorts is important. Often I go to write up an offer on a compelling situation only to find it has gone pending in the last hour.

If the numbers make sense (and you should know your numbers before acquiring your target) pull the trigger that day. Sometimes the reo agents will put up road blocks (eg a preferred lender prequal, absurd addenda with offer) but a good agent will know how to deal with those.

Also, short sales require lots of patience. The seller's bank can take months after seller acceptance to give approval. Some clients make offers on short sales and keep looking. Since shorts generally don't require a deposit for acceptance, it does not automatically tie the buyer's hands for the time spent negotiating with the seller's lender. The buyer can still look around.

Again, I think the biggest disability of sub 20 buyers is the inability to structure a cash-heavy lowball. You simply don't have the ability to make funding a sure thing every time.

Patience, we have, and when the time comes closer, we'd rent month to month, so that won't be an issue.

So, a buyer can submit 2 offers on 2 different properties that are short sales, at the same time, both with, let's say, 10% down?

If the buyer's offer is approved by the seller's lender(s) can the buyer still walk on it? When does it become cash comittment?

[/quote]

Submitted by Scarlett on January 5, 2009 - 7:05pm.

FormerSanDiegan wrote:
SD Realtor wrote:

I am not sure I agree with that concept but it is indeed happening. Also you may not have to save another 10% to get to 20% down. Maybe you need to save 5% and housing prices drop another 5% and then you have made it.

Not sure the lender would apply the same interest rate and relieve the buyer of PMI though. So, it's not really 20% down.

But a good point, nonetheless.

True, true! But also to keep in mind the PMI, albeit not negligible, is only for a few years, while the rate is until you re-fi (assuming fixed rate loan)

Submitted by SD Realtor on January 5, 2009 - 7:25pm.

PMI can be petitioned to be removed when you can document that you have achieved 20% equity in the home. In a declining market this may be challenging to say the least. However yes it can be removed.

As far as short sales go you can fire off as many as you like. There is no obligation and not any cost to you to do so. Realize a few things though, first that the lending conditions when you submit the short sale may be drastically different then when the short sale is actually accepted. Additionally keep in mind that it is difficult, though not impossible to get any concessions from the lender authorizing the short sale after it has been accepted. What I mean by that is you may want to try to make sure that you either build in repair costs to your original offer. That is, say you submit the offer, then 3 months later get acceptance, then you do your inspections, then you go back to them and say, okay I want 8k back for repairs. The short sale negotiator has to then review the file yet again. I am not saying he will not agree to that, BUT it is not a path I would recommend you follow. You may want to think about getting the inspection done before you make the offer or just discount your offer by what you think the repairs may add up to. Once you get that approval on the short sale going back and getting a second approval because you want more money back is kind of a pain. Just my opinion as other realtors may feel different.

Submitted by Scarlett on January 5, 2009 - 7:40pm.

SD Realtor wrote:

(...) first that the lending conditions when you submit the short sale may be drastically different then when the short sale is actually accepted. Additionally keep in mind that it is difficult, though not impossible to get any concessions from the lender authorizing the short sale after it has been accepted. What I mean by that is you may want to try to make sure that you either build in repair costs to your original offer.

Thanks a lot, SD Realtor, that is a very good point, I haven't thought about it! Very important to take into account.

I probably would eat the repair costs within, let's say, 10K. I am not that much of a haggler...But if you submit an offer right away - no time for inspection, and then later find out something major, like 20K repairs for something wasn't easy to spot with the naked eye, would you recommend to try to get concessions in this case if we don't want to pay for it - or be prepared to walk out of the deal? Is it ok to walk?

Submitted by KCTxr on January 5, 2009 - 7:59pm.

We are maybe in a similar situation and looking in PQ. Lease here now and owner has stopped paying the bank. Add one more to that list.

Submitted by SD Realtor on January 5, 2009 - 8:01pm.

Yep it is okay to walk. Just make sure it is done before the contingency period expires. You can also make a request for repairs as well. You never know, the lender may say yes but they have to rerun the numbers with the adjustments and get approval. Sometimes it happens and sometimes it does not. My experience is that more often then not it can be challenging.

Submitted by sdrealtor on January 5, 2009 - 8:10pm.

I handle a lot of short sales and the single most important thing I look for is an agent that stays in touch with me regulalrly during the approval process. In the typical short sale, I submit an offer to a lender I think will get approved AND that I beleive is at a price I can replicate. If some lunatic buyer submits a crazy high offer, I dont want to submit that one because if approved I then have to find another fool who can do the same. I'd much rather get an approval at a reasonable price and then go back to fool after I have the approval to see if they are still there.

In most cases, buyer #1 is gone and I have an approved short sale without a buyer. I then get to pick who gets the house in most cases among a handful of buyers who are still interested. Sometimes, I have a buyer that will pay more than the approval amount, sometimes I have to go back to the group and say here's the price, who wants it and sometimes I have to bring a lower offer.

Regardless, the agent that has stayed in touch through the 30 to 60 days it takes me to get the approval stands the best chance of getting the house for their buyer.

Submitted by Eugene on January 5, 2009 - 8:10pm.

Quote:
What exactly do you mean by 'sticking around long enough for your offer to make it through the system'? What does one have to do, after submitting an offer? Sorry, I have no knowledge of how the short sales work - yet!

Submit an offer and wait, possibly several months, while the offer is being considered by the bank. Keep an eye on the market, make other offers. I heard that most short sale offers don't go anywhere, and the success rate is very low. For this reason, discount brokers like Redfin don't even deal with short sales (with a few exceptions). I would encourage you to keep shopping around till the day you get written approval of one of your offers.

Submitted by patientrenter on January 5, 2009 - 8:15pm.

Scarlett wrote:
....saving another 10% down payment or 50-60K may take years and years, realistically (in my case). In the mean time, with kids, it's nice to have a larger house & yard while they are still young. I didn't mean that I would buy something right away, but perhaps in the next year or two - hopefully by then the prices would have reached their last/bottom leg in areas I am looking.

Scarlett, I am sure that you are a wonderful person, but if it would take you "years and years" to save 10% of the price of the home you want to buy, then you cannot afford it. The only way you can "afford" it is if its price only goes up, not down. That is never guaranteed. It is widespread denial of the simple 'cash flow' criterion for affordability that got the entire economy into its current fix.

Submitted by urbanrealtor on January 5, 2009 - 10:28pm.

To Scarlett:
The things SD and sdr are saying are pretty much right.
Not a commitment until the contingencies are up.
I missed much of the conversation tonight because my buyer was dropping a verrrrry slooowwww moving reo when an older offer she had made on a short got approved by the lender (same lender ironically; you think they would have noticed). We were within contingencies and the reo deal had an asset manager who was out of touch with California. He wanted 3 bids before fixing a leaking gas line (I just called SDG&E while they took it up in committee). I have other clients who will make offers on a few short sales at a time. Again, if they are unable to sell in a timely manner, you have no real risk.

To esmith:
I often disagree with you ma'am but your suggestion of strategy is right on.

To patientrenter:
I really don't think you have enough information to make those assertions. Lots of people who are perfectly capable of paying the mortgage on a $400,000 loan value are not likely to have an easy time saving an additional $100,000 for an 80% financed option.

Also, most of the reo's I see (granted this is anecdotal) are not people with 5 or 10 percent cash purchases, with 30 year fixed loans, buying when PITI is comparable to rent.
Most appear to be people who financed 100% and/or bought when PITI was 2 times rent and/or were using a creative lending product.

How do you define one's ability to afford something?

Submitted by Scarlett on January 5, 2009 - 10:37pm.

Cash flow criterion works, Patientrenter!

patientrenter wrote:

Scarlett, I am sure that you are a wonderful person, but if it would take you "years and years" to save 10% of the price of the home you want to buy, then you cannot afford it. The only way you can "afford" it is if its price only goes up, not down. That is never guaranteed. It is widespread denial of the simple 'cash flow' criterion for affordability that got the entire economy into its current fix.

We have $170K income and excellend FICO scores. If we can't afford a decent 4 br house that now goes for 550-600K, how many can then? By "years and years" I meant more like 5 years in the current conditions, playing it safe by first putting away money for college and retirement, before saving for down payment.

I am paying rent of $2700 and save ~$1000 per month, after retirement, college fund savings. I think in terms of cash flow, assuming steady income, it works just fine. With $3600 total PITI and 10% down, I could buy something quite decent right now, instead of waiting those 5 years. I don't care much if the prices don't go up, though it would be nice.

What if in 5 yrs the rates are over 10-15% and the prices haven't dropped dramatically (though they probably would, with those rates)? I may not be able to afford the monthly payment then, even if I have 20% down. Why wait (except for prices to decline further)? Why should I turn off all the other savings and live in a crappy place in order to save that those money in couple years instead? What's wrong in this case to buy now with only 10% down?

I can tell you what's wrong. You are right, it shouldn't take us years to come up with an extra 10%, when you have 170K yearly income, even with that high of a rent. The house market is still so much out of whack. The prices should be HALF of what they are now!!! Ok, maybe not quite half, but at most 66%. Then yes, I'd have 20% down right now. Well, I am waiting, maybe they will go down that much in a couple years. I think they will.

Scarlett

Submitted by HLS on January 5, 2009 - 10:38pm.

Scarlett, you need to get qualified for a loan.

For loan amounts below $417K, at the moment, there are 95% FNMA loans available with a mid credit score of 700+ This can change at any time.

As far as I'm concerned, FHA loans are like assigned risk auto insurance. If you are willing to pay the price, they will deal with you.

They represent more risk and will cost you much more than if you have a larger down payment.

If the loan amount is $417K-$546K in San Diego County you will need at least 15% down for FNMA
or
3.5% down for FHA loans up to $546K in San Diego County..

These are the guidelines for FNMA or FHA to buy the loans. I don't know of lenders that make exceptions the way people seem to think.

Lenders/banks dont make money lending their money for 30 years on fixed mortgagges. They MUST meet the guidelines to be sold to FHA or FNMA. Then they are bundled into MBS.

Rates can be higher at banks, and programs or knowledge of the bank employee can be limited, the same applies to mortgage brokers.

You should find someone to work with regarding a loan. You need to KNOW that you qualify for a loan before you even start thinking about buying a house, not just assuming that you qualify.
Some of the guidelines are crazy. LOTS of people don't qualify, but think that they do.

I doubt that the chances will increase to lend to really risky borrowers again for a very long time; that's what got the world into this mess.

The current guidelines already allow for people that probably shouldn't be buying homes to buy them. Not as silly as a couple of years ago, but still pretty silly. ...HLS

Submitted by Scarlett on January 5, 2009 - 11:45pm.

HLS, I was pre-qualified with Chase. For $500K loan with 10% down , or if I wanted only 5% down, an FHA loan; that was about 6 months ago. I have stopped looking actively so I haven't updated my pre-qual. I don't remember all the details, since I wasn't too serious about buying, but I doubt I wouldn't qualify now.

Submitted by HLS on January 6, 2009 - 12:36am.

Sorry, I was confused. If you know that you will qualify, what was the point of your post ??

Do you think that REO sellers don't deal with approved buyers ??

The seller wants money. They don't care where it comes from. They get their money at close of escrow regardless of whether it's a cash buyer OR from a loan.

The seller has nothing to do with the amount of the buyer's down payment. Most seller's just want the highest price they can get.

I'm still confused by your original question.

Submitted by sdrealtor on January 6, 2009 - 12:46am.

HLS
Stick to what you know. Lenders and SHort Seller select the strongest buyers. They do care where it comes from if things are equal or close. The bigger the down payment, the less perceived risk the buyer wont qualify for the loan because in RE we deal with limited information regarding the buyers true qualifications. As listing agents, we dont get access to the same information on potential buyers as you do for them.

Submitted by Scarlett on January 6, 2009 - 12:56am.

HLS wrote:
Sorry, I was confused. If you know that you will qualify, what was the point of your post ??

Do you think that REO sellers don't deal with approved buyers ??

The seller wants money. They don't care where it comes from. They get their money at close of escrow regardless of whether it's a cash buyer OR from a loan.

The seller has nothing to do with the amount of the buyer's down payment. Most seller's just want the highest price they can get.

I'm still confused by your original question.

HLS, I was told and I got the impression that, for decent houses that are REOs or short sales, there are always multiple offers or bidding wars. And there are almost always buyers with a more solid offer cash-wise - i.e. 20% or more cash. And that the (seller's) banks actually prefer less risk, than a little more money with more risk (i.e. less than 20% down). Not sure how true this last statement is. Do the sellers take the highest price, if it's less than 20% down? That is why I was wondering about the chances with less than 20% down to be accepted when multiple offers.
I understand now I'll probably have to come with a slightly higher price to make it more attractive, question is now how much higher. Sorry if I was not clear.

Thanks for all your input,HLS.

BTW, 6months ago I was qualified actually for 700K FHA loan with 5% down. 2 months ago, the broker wanted to update the qual and do 10% down conventional. By that time, I was convinced I didn't want to buy then.

Submitted by HLS on January 6, 2009 - 1:26am.

sdr, Thanks for the advice. I've been involved with So Cal Real Estate for over 25 years.
I've dealt with my share of ignorant mortgage and RE agents, there is no shortage of either.

There are some sellers that might believe that a larger down means a stronger buyer, but that is nonsense. Not all sellers are that stupid. They get their money at closing regardless of the down payment.

I can provide approvals and get loans done quickly for strong borrowers. It's ignorance that makes people think that a larger down is a better offer.

sdr, you already mentioned that you have had buyers in escrow for ages, while I am closing loans in a couple of weeks.

Many agents are absolute idiots, as well as many mortgage people are. Get a good agent and a good mortgage person together and deals will happen quickly.

The generalizations that are thrown around mislead strong borrowers like Scarlett to believe that they need to pay a higher price that they really need to.

Scarlett, you need a good agent that can represent you, and I don't believe that you need to overpay to compete with a larger down offer.

Are you being told that your higher offer will get trumped by a lower offer with a larger down payment ??

I'm sure it was a REALTOR that told you you will have to pay more to compete...

FHA and FNMA loan limits have changed, they have gone down. You can qualify for more than you want to borrow.

I hope that you are getting good advice about your loan options, but it doesn't sound like it. You are a strong borrower, even with a low down.

I imagine that it is a REALTOR telling you that you aren't a strong buyer ??
GIVE ME A BREAK....

I'd love the opportunity to work with you. . HLS

Submitted by LAAFTERHOURS on January 6, 2009 - 8:34am.

Scarlett wrote:

That's very true :) But we will be patient at least another year, rather than doing something risky. We are renting in a place with ultra-short commute, in UTC, and if we buy a house (in PQ, CMR), it will definitely mean a significantly longer commute. So with that in mind, we find the patience to wait (we HATE commuting in the rush hours!).

Thanks!!!

PQ and CMR to UTC is an easy commute - maybe 20 minutes. I commute from 4s to the 5/56 intersect in 20 minutes and most of it is backroads. Even at 5/530/6 pm when traffic is stopped on the 56 from El camino east three exits, its 20 minutes. Bypass from UTC would miss all the traffic.

Submitted by sdrealtor on January 6, 2009 - 10:48am.

HLS, I didnt say a larger down means a stronger buyer, I said it means a perceived stronger buyer. We dont have access to the same information on a buyers qualifications as a lender does. Furthermore, it may come as a surprise to you, but most mortgage brokers lie to us on a daily basis. Yes, they lie over and over again. We can only make decisions on information we can verify ourselves and if that makes us ignorant to some extent so be it. That is why large down payments rule the day. We can verify the money is there via bank statements. A piece of paper from you or any other pre-approval letter is worthless to me unless I have a solid history and experience with you that I can base trust upon. That is why direct lender letters are perceived to be better. Personally, you sound on the ball and I'd love to work with you. You seem to carry yourself much as I do. You'll be hearing from me. We just have to have confidentiality in place because, I'm not a face on the shopping cart guy. I prize my personal life and privacy.

As for the buyers in escrow too long, they arent my buyers as I am the lisitng agent. If I could push them to a better lender like you, I would.

Scarlet doesnt need to pay more, she needs a good agent. In choosing which buyer to go with, the agent who represents them and how they keep in contact with me through the short sale approval process is the single most important factor to me beyond a fair price and solidly qualified buyer. I never tell a buyer that I represent with a smaller down payment that they have to pay more. I tell them they might get trumped by another buyer with more cash and there is probably little they can do to overcome that and its OK. Make an offer you are comfortable with and stick with it. If not this house, there will be another.

Submitted by HLS on January 6, 2009 - 11:45am.

sdr,,
Why do people lie ?
Nothing to gain from it.

I respect you and know that you know your stuff.

It's difficult to separate sarcasm, humor, etc on a blog....I agree with you.

In reality, a letter from direct lender is no better than one from me. Until the loan is underwritten and approved, it's only an application.

One thing the direct lender might have over me is that they might get away with doing something illegal and getting away with it.

Confidentiality is guaranteed, don't worry.

In my opinion, a REALTOR shoudn't be involved in a buyer's finances or ever see their bank statements or personal information.
They only need to know that the buyer is approved for their offer, without knowing the upper limits of what they qualify for.

That is confidential between me and my client.
People don't get this when they shop by rate alone.

You know how to reach me if you want to check with me. I'd be honored to have the opportunity. HLS

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