This would mean that making a loan application to a broker is not making a application to a lender. This is not new. I believe we have state case law on this. I think the year was 1999.

In order for a homebuyer to meet the financing contingency of making an application, that broker must submit the application to a lender within that time frame.

So Rhonda, if your brokerage has a correspondent credit line with Wells and Chase, you’re fine. If the borrower’s transaction needs to move to a different lender, meaning, a brokerage relationship instead of a correspondent relationship, I would take that to mean that yes, an LO has a duty to notify the agents.

The above comment is not meant to provide legal advice. If anyone reading this post must have a legal opinion, consult your favorite real estate attorney.

“For purposes of this Addendum, “lender” means the party funding the loan”.

As a correspondent lender, Mortgage Master is funding 90% of the loans I originate in our credit line. We are not selling the loans until after closing. We are the funder.

If I were just a broker and not correspondent, then does that mean I would be treated differently? Brokers are not funding their loans. So if a Loan Originator starts off with a preapproval they’ve obtained from Wells Fargo and then they find better pricing at Chase during the transaction so they move the transaction to Chase, does this mean they need to notify the listing agent if all the other terms have remained unchanged?

Bankers fund their own loans (as correspondents do).

Regarding the new wording about changing lender, the lender is not the LO and many LOs change the lender and resubmit the package to a different lender during escrow all the time. Most of the time without the buyer’s consent let alone the seller’s approval.

Do you read that to mean the loan broker or the actual “lender”? Most times the LO doesn’t know which lender they are going to use during that timeframe, the first 5 days of the contract.

You’re absolutely correct, it is the consumers responsibility to select the right person to work with them and to learn as much about the process as possible. The more you know, the less odds you have in being taken advantage of. The post I referred you to is older…I’m probably due to create an updated on!

Can you list what to look for in an LO? I am a first time homebuyer and after reading this post it is showing me that a good LO is a very important factor. Wow, and I thought finding a home at a reasonable price that I could make payments for, and a real-estate agent to process the paperwork was all that was needed. I shop at Nordstrom, but if Macy’s has the same thing on sale I’ll buy it there, or to top it off, if I find the same thing at Value Village nearly new, Yahoo! Really, the consumer has the responsibility for getting the best deal or leaves it to a personal shopper and pay the price! So, what important steps should I look for in an LO and what are my obligations?

In your opinion, is there a point where the buyer should be committed to the lender (assuming the lender is preforming)?

Once your buyer is “preapproved”, do you assume they’re working with that LO?

Sales Prevention Team… I’ll have to remember that one!

The client ABSOLUTELY as the right to shop…..and sometimes they come in to the relationship their own LO.

The track record from years of experiences and 100’s of transactions show that these unknowns range from “outstanding”, to “dishonest”

When the deal blows, because of the LO, it’s as messy as it gets.

For the quest of the lowest rates, many have gone the on-line route. Frankly, I can’t remember many on-line lending experiences with clients that have turned out well.

That being said, we can counsel and educate based on our experiences. However, the consumer HAS THE RIGHT to make their choice on who to go with for their money.

In the end, however, common sense must prevail. It’s been my experience when agents become too rigid on any issue……loans, escrow, title, or other contract details, these agents often do it out of ego, not what is best for a client.

When I’m working with an agent on the other side who exhibits blind rigid behavior, I often refer to them as the “Sales prevention team”.

To find out what is best for a client, we have to listen. If it makes sense for the client….it should be so.

“If you have plenty of business, then let the bilirubens go try and find that mysterious, magical loan with the lowest rates and fees. Wherever it is, it’s probably sitting right next to a diet pill that will take off those last 10 pounds, the fountain of youth, and the perfect lover.”

the bilirubens, and I know there’s a lot of you out there, wouldn’t be happy with their LO even if somehow they did get the lowest rate at the lowest fees possible. They will always wonder how they’re getting screwed and who’s offering a lower rate somewhere else.

I perform better when my clients (agents included) trust me and I can trust them. If there’s not trust, it’s not going to work with me. I know trust is earned…this is probably why my business is referral.

Clients come to me all ready with some degree of trust because their friend or family member had a good experience with the mortgage services I provided.

Real estate agents who refer business to me do so because they know I’m being completely straight, I don’t blow smoke or kiss a$$. They also don’t run double aps with me against another lender. It’s back to the trust issue. I’ve worked with most of my agents since I was in title insurance, so they’ve known me up to 20 years. They know my ethics and how dedicated I am.

People who don’t know me, would not have a reason to trust me.

“Buyer may not change the type of loan or the lender without the Seller’s prior written consent after the agreed upon time to apply for financing expires.”