Comments on: Bribery to Work with the Builder’s Preferred Lender http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/ Seattle's Leading Resource for Real Estate Information Sun, 08 Nov 2009 01:47:42 -0800 http://wordpress.org/?v=2.8.4 hourly 1 By: Buyer's Broker (Agent) - Atlanta Georgia http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-322387 Buyer's Broker (Agent) - Atlanta Georgia Sat, 26 Jul 2008 21:47:50 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-322387 This is solid advice; you have to hold those preferred lenders accountable through cross comparisons. This is solid advice; you have to hold those preferred lenders accountable through cross comparisons.

]]> By: Rhonda Porter http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320245 Rhonda Porter Tue, 24 Jun 2008 20:51:22 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320245 Thanks, Edward! It's amazing how people are not able to see through how the homes are priced factoring in all of the great bells, whistles and rebates--while the buyer is paying for it. Thanks, Edward! It’s amazing how people are not able to see through how the homes are priced factoring in all of the great bells, whistles and rebates–while the buyer is paying for it.

]]> By: Georgtetown Texas Real Estate, Edward Lui http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320243 Georgtetown Texas Real Estate, Edward Lui Tue, 24 Jun 2008 19:51:00 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320243 Good post Rhonda, You inspired me to write a follow up blog to this entitled "Bribery to Work with the Builder's Realtor" Something that has been on my mind for the past 2 weeks. Now the shoe is on the other foot and I know how the lenders feel! I proposed a different type of Preferred Realtor Program that would cooperate and not compete with the real estate community. I wonder if the same can be done effectively for the lender programs. Edward Good post Rhonda, You inspired me to write a follow up blog to this entitled “Bribery to Work with the Builder’s Realtor” Something that has been on my mind for the past 2 weeks.

Now the shoe is on the other foot and I know how the lenders feel! I proposed a different type of Preferred Realtor Program that would cooperate and not compete with the real estate community. I wonder if the same can be done effectively for the lender programs.

Edward

]]> By: Georgetown, Texas Real Estate Blog » Blog Archive » Bribery to Work with the Builder’s Preferred Realtor http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320242 Georgetown, Texas Real Estate Blog » Blog Archive » Bribery to Work with the Builder’s Preferred Realtor Tue, 24 Jun 2008 19:47:11 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-320242 [...] to Work with the Builder’s Preferred Realtor I just read a great blog article entitled: Bribery to Work with the Builder’s Preferred Lender and I could certainly resonate with the author, Rhonda Porter. I wrote about the same subject on an [...] [...] to Work with the Builder’s Preferred Realtor I just read a great blog article entitled: Bribery to Work with the Builder’s Preferred Lender and I could certainly resonate with the author, Rhonda Porter. I wrote about the same subject on an [...]

]]> By: Rhonda Porter http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-281271 Rhonda Porter Mon, 10 Mar 2008 00:40:45 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-281271 Roger, I've written about that before here at RCG. Roger, I’ve written about that before here at RCG.

]]> By: Builders Lenders Bribing Buyers | Fredericksburg Real Estate http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-281225 Builders Lenders Bribing Buyers | Fredericksburg Real Estate Sun, 09 Mar 2008 23:07:03 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-281225 [...] Sometimes I find a post on another blog that is so well done, that I simply want to link to it here on this site.  That happened today when I read Rhonda Porter’s blog article, “Bribery to Work with the Builder’s Preferred Lender.” [...] [...] Sometimes I find a post on another blog that is so well done, that I simply want to link to it here on this site.  That happened today when I read Rhonda Porter’s blog article, “Bribery to Work with the Builder’s Preferred Lender.” [...]

]]> By: Pablo http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-248022 Pablo Tue, 22 Jan 2008 07:04:45 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-248022 I was thinking in this downward market that one of the reasons builder wants you to use their preferred lender is so that the loan and subsequent home appraisal will all be approved for the sale price (even though an actual unbiased appraisal may show otherwise). Example: the home sales price the builder is asking for the home is $500k, however the home is really only worth $450k. Appraiser (who most likely has some kind of relationship with the Builder's preferred lender) is "encouraged" to make sure the home appraises at the $500k sales price so the loan will go through. In effect netting the builder $50k more than the home is really worth. I was thinking in this downward market that one of the reasons builder wants you to use their preferred lender is so that the loan and subsequent home appraisal will all be approved for the sale price (even though an actual unbiased appraisal may show otherwise). Example: the home sales price the builder is asking for the home is $500k, however the home is really only worth $450k. Appraiser (who most likely has some kind of relationship with the Builder’s preferred lender) is “encouraged” to make sure the home appraises at the $500k sales price so the loan will go through. In effect netting the builder $50k more than the home is really worth.

]]> By: Builders Lenders Bribing Buyers « Fredericksburg’s Real Estate Voice http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-214771 Builders Lenders Bribing Buyers « Fredericksburg’s Real Estate Voice Wed, 21 Nov 2007 13:44:59 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-214771 [...] Sometimes I find a post on another blog that is so well done, that I simply want to link to it here on this site.  That happened today when I read Rhonda Porter’s blog article, "Bribery to Work with the Builder’s Preferred Lender." [...] [...] Sometimes I find a post on another blog that is so well done, that I simply want to link to it here on this site.  That happened today when I read Rhonda Porter’s blog article, "Bribery to Work with the Builder’s Preferred Lender." [...]

]]> By: Rhonda Porter http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-135511 Rhonda Porter Tue, 15 May 2007 17:06:00 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-135511 Jason, PS: I don't know where you got 3 points at 5.875%? Jason, PS: I don’t know where you got 3 points at 5.875%?

]]> By: Rhonda Porter http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-135508 Rhonda Porter Tue, 15 May 2007 17:05:06 +0000 http://raincityguide.com/2007/05/06/bribery-to-work-with-the-builder%e2%80%99s-preferred-lender/#comment-135508 Jason, I did compare the "preferred lenders" GFE nickle to nickle. 6.125% was at 1.125% with the builder's lender. That day, 5.875% was at 1% with me. The other costs were pretty comparable. How is it looking in the best interest of the buyer? The buyer should be able to chose the lender they want to work with. Many builders will down right refuse to allow this. This practice doesn't even seem like it should be legal IMHO. IT'S THE BUYER'S CHOICE. The buyer does have the right to compare lenders. My point in these examples that I recently dealt with, the builder's lender was not better. And, I have had times when the selling agent bumped down the price or kept the price the same and asked the builder for the credit while keeping the buyer with me, and THE BUILDER AGREED. "Outside Lender" is your view. When I am the Mortgage Professional who has been counseling the buyer and helping them select a program best suited for their needs...sometimes working with them for months...just to have a BUILDER BRIBE them...it's wrong. If the deal is truly better, I can accept it. As I mentioned, lately that has not been the case. I don't feel that I'm the "Outside Lender" when I'm the one with the relationship with the buyer. The builder's LO has their client bought and paid for...bribed. $4000 credit at a higher interest rate and origination from the loan officer? The credit was padded in the LOs rebate on the back end. Is that in the buyer's best interest? The second scenario, the builder's lender had limited products (they are a bank), and this builder would not give the closing cost credit to the buyer. My buyer elected to stick with me for the better program and lower payments. Is that in the buyer's best interest? Jason, I did compare the “preferred lenders” GFE nickle to nickle. 6.125% was at 1.125% with the builder’s lender. That day, 5.875% was at 1% with me. The other costs were pretty comparable.

How is it looking in the best interest of the buyer? The buyer should be able to chose the lender they want to work with. Many builders will down right refuse to allow this. This practice doesn’t even seem like it should be legal IMHO. IT’S THE BUYER’S CHOICE.

The buyer does have the right to compare lenders. My point in these examples that I recently dealt with, the builder’s lender was not better. And, I have had times when the selling agent bumped down the price or kept the price the same and asked the builder for the credit while keeping the buyer with me, and THE BUILDER AGREED.

“Outside Lender” is your view. When I am the Mortgage Professional who has been counseling the buyer and helping them select a program best suited for their needs…sometimes working with them for months…just to have a BUILDER BRIBE them…it’s wrong. If the deal is truly better, I can accept it. As I mentioned, lately that has not been the case. I don’t feel that I’m the “Outside Lender” when I’m the one with the relationship with the buyer. The builder’s LO has their client bought and paid for…bribed.

$4000 credit at a higher interest rate and origination from the loan officer? The credit was padded in the LOs rebate on the back end.

Is that in the buyer’s best interest?

The second scenario, the builder’s lender had limited products (they are a bank), and this builder would not give the closing cost credit to the buyer. My buyer elected to stick with me for the better program and lower payments.

Is that in the buyer’s best interest?

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