Choose a Realtor with Access to Multiple Loan Products
The most important steps to take before purchasing a home are saving for a down payment, getting pre-approved, doing your research on what to expect from the entire process, having an idea of the type of neighborhoods you want to live in, and enlisting a realtor that can help make your home buying journey as simple as possible. This also means choosing a realtor that is able to offer access to multiple loan products and understanding how the lender-realtor relationship can affect you.
Get pre-approved for a home loan before enlisting a realtor
It would be very disheartening to work with a realtor on finding the perfect home, only to get your home loan rejected by a lender after spending your precious time and money viewing multiple properties. This is why you should work with a no-obligation lender or loans officer that can help you get pre-approved for your home loan before working with a realtor.
Even though a realtor is a key part of contract negotiations and finding the ideal property, lenders and home loan officers can offer financial expertise that a realtor doesn’t have. Pre-approval will help you understand the various loan products at your disposal, including finding the best mortgage rates, which is important if you want to save thousands of dollars in interest over your mortgage period.
RESPAs, realtors and lenders
The Real Estate Settlement Procedures Act (RESPA) is a federal law that regulates co-marketing agreements between realtors and brokers. Realtors and lenders often market themselves as partners to bring in more business and increase their competitiveness. RESPA bars realtors from receiving money or anything of value from lenders in exchange for referrals. This law also states that homebuyers aren’t forced to use a lender that’s working with a particular realtor.
Despite this, the partnership between a realtor and lender can offer great benefits and seeing that they get most of their business via word-of-mouth, they are likely to offer great service and conduct your home buying process as smoothly as possible.
Transparent and clear communication
Realtors that have access to multiple loan products are able to offer transparency and clear communication to their clients as they’ll easily be able to check the progress of the loan.
Closing on time
Missing a closing date can result in thousands of dollars going down the drain. This is because sellers lose potential earnings, the buyer loses their dream home, and the realtor and lender also miss out on the potential revenue from the sale.
We hope the information above helped you get a better understanding of the realtor-lender relationship and how it can potentially affect you when purchasing a new home.
We can offer several lender referrals for your needs, call us 619-944-5972