Pre-approval letter held hostage by realtor???

Question

Are lenders required to give you a pre-approval letter. I got a referral from my realtor for a local lender for pre-approval. I informed the lender I would be acquiring multiple "quotes" to compare so please provide as much detail as possible. We did all paperwork credit check etc, Lender emailed "you qualify for 350k @ 20% down and I would like to talk to you over the phone about it". I think he miss called once but never brought up the phone call again in the emails. meanwhile I've been requesting the pre-approval from day 1. They just simple ignore my email thats requesting the letter but if I email again about something else they reply. After about 1mnth of waiting I literally told him to shove it AND THATS WHEN HE TOLD ME OK I WILL SEND YOU THE LETTER. They never told me what the interest rate was or anything and I was supposed to just go with that. They could've given me any interest rate/fees they wanted if I used a pre-approval but  couldn't see the details. I think my realtor (who helped me sell my place last year btw) might have told the lender not to give it so I wouldn't be able to use it with another realtor. Can you make offers without a realtor using a pre-approval letter and keep the 3% in ILLINOIS?

Caroline Gerardo · Answer

A solid Underwritten pre-approval says your w-2, paystubs, IRS taxes, bank statements, credit middle mortgage FICO have been formally approved is required for a listing agent and seller to take you serious and believe you can close on time. You supply the homework paperwork fine tuned to your situation. An informal letter saying thumbs up for $350000 is useless. No point in shopping around for rates unless you have an accepted offer.

All your income and bank statements should be labelled in pdf files on your laptop or desktop not photos on your phone. Ask the lender for a copy of the mortgage credit report they pulled (it's 20 or more pages) If they won't give it to you find someone who will upfront BEFORE you apply. Ask them what the preapproval says- does it include your middle FICO, does it say what type of loan, does it say how long they take to close, how long has this person been doing mortgages?

If you have same job the past 36 months and great credit 720 + you can apply to some cheaper online lender. Apply with only one after you get the answers to the above questions.

If you have a variety of things and whistles going on you need a mortgage banker to wade through and make you appear wonderful on paper.

If your loan is saleable one to Fannie Freddie FHA VA everyone's rates are pretty much the same. What makes it vary is your FICO score, property type etc. Rates change a couple times a day so a quote you got a week ago is of no use. Search for the person who "gets" you, yes, this is part love match. Your needs and style of communication should fit the type of lender and the person. The kid in the call center behind the online deal and shiny young face in the bank are the lowest paid beginners who can deliver a good rate but cannot answer complex situations.

Your realtor knows you and suggests the match for the combination that makes you the wonderful person who you are.

We provide a detailed approval letter in 24 hours from when you supply the homework. The letter is emailed to you to give to whomever you want to share it. Our twenty-four hour seven days a week phone lines are on the letter to answer any question the seller may ask. Letter says we can close in 4 days if needed and everyone is cooperative. If you have a lender who is known to be slow or the selling agent has had a bad experience with that person this is where your agent shines and gets another letter. Everything in life is about communication.

Caroline Gerardo · Answer

I said: you need a preapproval letter which is Underwritten before making an offer, I did not say make offers without knowing the amount you qualify for.

Your shopping method is not helping. Rates change a couple times a day. Buying single family with a conforming loan is about the same rate everywhere. As a buyer you do not pick the title/escrow/attorney fess/notary, (generally chosen by the seller). Appraisal you don't choose. Most companies have a processing fee around $800-1000.

Lenders see you shopping with the inquiries on your credit, you may increase the rate you end up with by shopping longer than 31 days as the FICO decreases if you keep letting lenders pull your credit.

Gregory Isaacs · Answer

I logged in through Google and now it keeps logging into this name not Jessica.

@Caroline I was dealing with Domenic VP @ neighborhood Loans. I gave them all the documents you listed. This is a straight forward 30yr fixed. W2 for many years. I have 200k+ in investments so I have down-payment. I have 750+ score with no debts foreclosure etc. I bought townhouse in 2017 for 153k fixed it up myself and sold it for 235k in 2020. What you are saying is interesting. You're saying I should be able to have enough time get the pre-approval after I have an accepted offer? How would I know how high I can offer and how would the seller know to accept that offer without seeing the pre-approval.

I understand they can't give me a specific number because it's based on the property. Often I ask myself what is the point of all this if the numbers are all going to change anyway. They can give me a general pre-approval letter so I can compare because some lenders are giving me interest rates that are almost 1% higher than others. This let's me know which ones I can root out from the start.

@Russell we already discussed all those details and I included a property as example. I don't know if he call me or not because I work 2 jobs. I don't take phone conversation as a contract either.  Are you saying that all lenders have to give the same interest rates? What should I be comparing lender fees? What are acceptable fee rates?

Russell Brazil · Answer

Why wouldnt you just get on the phone to discuss the preapproval? It isnt as simple as having a preapproval letter. Different jurisdictions have different tax rates, difference insurance rates. There is dozens of different loan types and options. So it isnt as simple as saying you are approved for a certain price. You might be able to afford $350k in fictitious Town X, but only $300k in Town Y with the same product. You might afford less with a fixed rate and more with an ARM.  You can not create a loan estimate without a specific property that has specific details of that property.  Further, rates are constantly changing as the market is open and bond prices move. You could get a different rate even from the same lender in the same day if the market moves enough.

Pre-approval letter held hostage by realtor???

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