Realestate agents? Are you the one who is supposed to find the lender or is the buyer?

Question

I live in NC. Im not sure if that matters. Anyways, my friend is looking for a house and he has gone with someone who has just finished up their realestate classes and recieved their license. The realator calls my friend and tells him "Hey I got a number of a guy YOU need to call and talk to...I think he will give you a good rate." He has yet to help him even FIND a mortgage company. I dont think my friend knows where to start. he assumed and so did I that the agent was supposed to help with that. Am I wrong or should the agent be taking the personal information to find him a lendor or at least giving him a list or lenders to contact?
Thanks for all your kind answers!

Answer 1

First of all, I think I would rather work with someone more experienced, as buyers need considerably more expertise than a newbie can provide.
As for mortgage and closing that is up to the buyer. As part of my services, I generally give me clients some names and let them choose. They should talk with at least three lenders to see what different programs are available and of course rates. While I can make arrangement for closing, I always ask if they prefer one place over another. Most folks don't know title companies like they do lenders.

Nowadays, some Realtors (depending on the client relationship) do not want to know the borrowers financial information. For example, if the borrower is purchasing a property the agent has listed (dual agency), then it's best if the borrower keeps his financial information confidential. Since I am not a mortgage professional, I leave most of the qualifying up to the lender. I am happy to accompany the client to each lender, but it's not necessary. If I've worked the area for awhile, I know most lenders. And in some places, each real estate company has their own loan divisions and/or title companies. Again, the buyer can select whom they want to work with.

If I can help further, just email me. Hugs from Minnesota!

Answer 2

I agree with most of the previous answers and would like to add the following:

1. A good agent will refer at least 3 lenders and never insist on working with any of them. Yes, more experienced agents will know who's got the better reputation for cost, professionalism, etc.

2. Always shop more than one lender. Most people don't know that multiple mortgage inquiries within a 14 day period will only count as one inquiry against the credit score (sometimes that period can be 30 days, but I always go with 14 days to be safe)

3. When getting quotes back, compare the APR vs the rate alone. The APR tells you the total cost of the loan over the 30 years and takes into consideration the fees involved in the loan. Caveat: for some people(those who plan on staying in the home/mortgage long term) , it's worth it to pay more fees in order to get a lower rate/payment. For others (those who only plan on being in the home/loan a short period of time) it's worth it to pay less in fees in exchange for a slightly higher rate. A good lender will go over at least two options with different rate/fee combinations.

4. When getting quotes, find out what needs to be done in order to guarantee the quoted rate. Ask whether that rate is locked, and if so, for how long. There's always that horror story of a lender quoting something only to have it change at the closing table.

Answer 3

It sounds to me like the call was the agent trying to help your friend find a lender. The agent can [and should] make a recommendation, and help the buyer find lenders, home inspectors, etc, but they are only allowed to recommend, not to contact the lender or make that type of decision for the client. Also, if the agent is new, he or she may not know which lenders are the best either.

Answer 4

A Real Estate Agent can advise a Homebuyer about the various lenders and maybe even assist in getting him approved, but the responsibility is the homebuyers since he/she will be the one to make the payments and should be fully informed as to the what type of loan they're getting into.

Shop around for the best rate.

Answer 5

Shop around. Shop around. Shop around.

Call at least two lenders - companies that actually lend their own money like most large banks and the big mortgage companies - at least two brokers - the people who shop around for the best loan they can find for you - and a credit union. And let everyone know you are shopping. Get a Good Faith Estimate from each. (Don't let them pull your credit until you're ready to apply.)

Include your REA's recommendation when shopping. If you don't use that person, explain why to your REA. They cannot be upset with you for trying but not choosing to close with a more expensive lender.

BTW, when I recently purchased my home, the REA's recommended lender came back with the best offer. I'm in the mortgage business (not with a lender or broker) and could not do better even with people I knew from working with them!

Answer 6

NO!
although agents do deal with brokers and banks its good to keep them apart. some times lenders and agent pass clients to eachother but it can cause problems and you can run the risk of a lender paying for clients or spiffs. it isnt legal to do unless the agent is also a broker but there are ways around it. i dont recomend anyone ever use a agents lender.

most borrowers find thier own lenders tell your friend to talk to a few brokers and ask for an estimate and compare!

the best one i know of is below. the articles are informative have him read this article it may help him save more money at closing!

Answer 7

wow, you got some REALLY good answers---people must like you---suggest you give DJB best answer as she gave hugs and an invitation to e-mail her further, and strongly suggest you do an MS Word cut and paste with some of the other good answers and print it out and study them. One common theme---this IS a huge decision, every tenth of a percentage point counts, upfront fees cost less than percentage points in the long run.

I have spent a lot of time in NC, some of it singing in church choirs at Montreat near Ashville, other times around Raleigh/durham where I have an aunt, cousin, and a few neices and a nephew. The one piece of advice I'd give you is this---the most important issue you will face in the net 10 years around a new house will possibly be the quality/availability of quality ground water and energy efficiency. I don't know if you're thinking rural, urban, or suburban, but whichever---put some serious thought behind the availability of quality ground water. It matters now---it's gonna matter more and more as time goes on.

all the best----brian

Answer 8

Realtors aren't obligated to find a lender for the buyer but most of them will at least help the buyer search various lenders. In the end, it us up to the buyer to make a final determination as to who the lender will be.

Answer 9

What is his thinking being inexperienced and using an agent that has no clue as well?

He needs to find an agent that has been around awhile.

A good agent will have contacts with people he knows will perform, not just promise good rates, but GET them. Many "mortgage" people are just scum bags looking to scam people like your friend. He needs a better agent who has decent contacts.

A good agent will help you with the data, but the buyer has to apply for the loan themselves.

Answer 10

The Realtor should have people he/she works closely with, but even so your friend needs to shop around to get different quotes from lenders. Tell him to just apply on a couple of loan quote websites and he will get a idea of rates, and also have different options instead of just going with a Realtor that just got into the business. Your property is a HUGE investment every % point counts so tell him to shop around.