Can Countrywide force pre-approval to Offer Buy

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kimberlylong

161 Posts

Posted - 04/29/2008 : 1:56:52 PM

Got a couple that is has a certificate of buyers approval and a approval letter from BOA for a mortgage. I show them a house they want to offer on it. It is a Countrywide REO. I am told in order to make the offer they MUST go thru Countrywide Home Loans to get a pre-approval code to submit an offer...or they can't make an offer on this house. Buyer doesn't want to run their credit again (it is not so great, doing FHA) and don't want to provide personal and information to Countrywide.

I think this should be illegal for steering or something...just seems wrong...

Guess this is ok. I mean if I listed my property can I make a buyer go thru my mortgage company to get pre-approved before I will review their offer? Would that be legal?

americanheartlan

2237 Posts

Posted - 04/29/2008 : 2:00:47 PM

Yup...very common with them.
They want to know the customer qualifies.

kimberlylong

161 Posts

Posted - 04/29/2008 : 2:03:55 PM

So, can a home owner do the same and make a prospective buyer go thru a mortgage broker of their choice to make sure they qualify?

Because if this is ok to do then we maybe able to get more market for ourselves folks!

americanheartlan

2237 Posts

Posted - 04/29/2008 : 2:06:11 PM

I highly encourage my FSBO clients to do exactly that with me.
Got one just yesterday that way.

CoolMtgGuy

4099 Posts

Posted - 04/29/2008 : 2:08:45 PM

Any property owner can require a potential buyer to be preapproved by a specific mortgage person or company. Builders do this all the time. I am seeing more sellers making this a requirement. It is not illegal. No one is forcing the buyer to fund the loan through them ... they are simply requiring pre-approval.

By the way, when I give a seller referral to a real estate agent, I specifically tell them that the seller and I require the buyer to be pre-approved by my company if they want a offer to be considered.

No sweat ... get with the program and go with the flow.

kimberlylong

161 Posts

Posted - 04/29/2008 : 2:08:52 PM

I hear you and get that with FSBO's. But, think of this if you have a Realtor contact and have all their listings agree to have pre-approval's thru my mortgage company before accepting any offer wouldn't that be a great gig? I just think it is steering and concerned about it; but if Countrywide is legal doing it..but is it because they own the properties?

mantixmortgage

2787 Posts

Posted - 04/29/2008 : 2:11:37 PM

interesting that they wont take a b of a letter

usually they take du findings

mganovsky

2114 Posts

Posted - 04/29/2008 : 2:11:39 PM

C/W is not doing any thing wrong, they do not make the client use C/W they just want a pre-Qual from a C/W LO to make sure the person can buy. I have had this happen 3 times in past 60 days. Not a problem just tell the clients what is going on and if you have a good repore with them then they will stay with you. I work at (or used to) a Real Estate Company and the realtors have me qualify all folks regardless of whether or not they have a pre-qual from some one else.

And yes I ask them what terms they were givin and I steal the clients if possible by giving a better rate and terms as well as lower closing costs. I love stealing deals from Banks.

cincyloanguy

135 Posts

Posted - 04/29/2008 : 2:18:58 PM

make friends with a countrywide loan officer and have them type a letter stating the program your borrower needs is not offered by them. I do that with investment offers i place.

bragloans

37 Posts

Posted - 04/29/2008 : 2:37:36 PM

good coverage of C/W steering here: http://forum.brokeroutpost.com/loans/forum/2/205234.htm

AK__47

813 Posts

Posted - 04/29/2008 : 2:42:03 PM

What if the Borrower doesn’t fit in Countrywide’s guidelines, but you have a lender that will do it. Do they deny the offer??

chasjh46

210 Posts

Posted - 04/29/2008 : 2:47:18 PM

Countrywide LO's hate doing those pre-quals. Ties up a lot of their time for nothing. I know the C/W retail office manager here locally. She makes the new LO's do those quals.

kimberlylong

161 Posts

Posted - 04/29/2008 : 7:37:49 PM

Well, I had my buyers make the call to Countrywide and they were told that they would need to pay off one of their credit cards in the amount of $8000 then they would pre-approve them so they can make the offer...not So, if they don't pay off this card they can make the offer. That is just ugly since BoA was ok with it as it is. So, they are just going to walk from that offer - there are many houses on the market. This just stinks.

So, it sounds like it is fine for any home owner to state that all potential buyers need to go thru my mortgage company for a pre-approval. If I do that and get my Realtor friends to do that for me then I should be able to capture quite a few deals! It just sounds too good to be allowed. Wonder why I have never heard of this going on or why I didn't do this years ago if it is legal to do. It just too good.

Quicksilver

4839 Posts

Posted - 04/29/2008 : 7:44:16 PM

Any REO property buyer will be requested by the owner (whatever bank) to be pre-approved with them, even if you showed them a full DO/DU approval.

slants

4303 Posts

Posted - 04/29/2008 : 7:51:37 PM

Rather than relying on prequals from incompetent LO's whose credibility is unknown to them, a sellers can ask his/her own trusted advisor (you) to screen the credit worthiness of a potential buyer prior to entering into a binding contract that could cause them great financial harm and lost opportunites if the buyer can't perform. They cannot require that the buyer use their lender, but have a right and very good reason to verify the legitimacy of the buyer's prequal through their own broker/lender.

CoolMtgGuy

4099 Posts

Posted - 04/29/2008 : 7:55:40 PM

"So, it sounds like it is fine for any home owner to state that all potential buyers need to go thru my mortgage company for a pre-approval. If I do that and get my Realtor friends to do that for me then I should be able to capture quite a few deals! It just sounds too good to be allowed. Wonder why I have never heard of this going on or why I didn't do this years ago if it is legal to do. It just too good."

It does provide some "at bats" and is perfectly legal. Remember that no one is requiring the borrower to use that lender to fund their mortgage. In fact, the borrowers must be told that they are free to shop around for their mortgage else they could claim that they felt pressured to use you to fund their loan.

Also, some agents will actually find it convenient to use/abuse your willingness to pre-approve a buyer and then take the business elsewhere ... so it is never a done deal. You only get an early opportunity to wow the borrower. Go for it!

Mandyvilla

3632 Posts

Posted - 04/29/2008 : 8:13:15 PM

I have buyers offer on CW foreclosures on a regular basis and have closed several. Yes, the CW loan officer needs to review and sign off, but they just need the 1003, my credit if I will release it or pull a new one. They will make the pitch, but there is no obligation. I suspect each region is different, but I do think someone is playing you.

That would make for a great news story of irony. CW refuses BofA's letter. And we wonder why they got into trouble?

kimberlylong

161 Posts

Posted - 04/29/2008 : 8:17:46 PM

Well, they said they have to pre-approve thru them not BoA. They have the BoA letter and Buyer Certificate of Approval with the offer. But, what bugs me is that lets say the Buyer pays off the $8000 credit card and the offer is not accepted as is then he just spent $8000 today that really didn't have to be paid off today - in there case it would be more $2000 more than what they have in their savings account. That would suck and it is possible. Sure they did the we can save you $500 dollar pitch which I expected but didn't see the payoff or no pre-approval...and yes they ran their credit too.

rtrefflich

3892 Posts

Posted - 04/29/2008 : 8:31:35 PM

This is no big deal, I send over 1003 and credit to other LO's all the time, and not once have I gotten any competition with them. The bank, seller, and agent don't want to spend time taking a property off the market for someone that won't qualify for the loan. They don't want your business, they want to make sure that your client can go through with the purchase. The only time I've ever had a realtor try to "steer" my client away is when there are problems with the loan and it looks like it may not close.

quote:
Originally posted by Mandyvilla

I have buyers offer on CW foreclosures on a regular basis and have closed several. Yes, the CW loan officer needs to review and sign off, but they just need the 1003, my credit if I will release it or pull a new one. They will make the pitch, but there is no obligation. I suspect each region is different, but I do think someone is playing you.

That would make for a great news story of irony. CW refuses BofA's letter. And we wonder why they got into trouble?

marklorico@gmail

65 Posts

Posted - 04/29/2008 : 11:56:27 PM

This happen to me just two weeks ago. I had a DO approved (which was forwarded to the L/A) at 95% condo and two lenders with MI companies that will accept. The REO is with WF and the L/A wants me to have our borrower speak to him. Of course they want 10% down for a condo in CA. But she qualified but she did not wnat to put 10% down. But I told the L/A hey I wouldnt waste my time qualifying a borrower for a loan amount of only 240k. Anyways they made the RE agent write an email stating that if it fell through that they would consider the 10% WF deal but not required.

I do have a buddy at WF from working there previously but the L/A insisted it be the other guy. To top it off the L/A wanted to know the DTI and the wages from last year... yeah right buddy! He would of hung up on me if i told him it was 62% lol. He was the only L/A out of 4 that accepted the borrowers offer for 5%. I emailed two of the other agents: that I got it approved and forwarded them the approval letter (sharpied the personal info) and asked for some business lol!

kellamtom

648 Posts

Posted - 04/30/2008 : 05:00:16 AM

if cw taking loss on the reo nothing wrong with them attempting to minize thr losses by getting that loan back; i do know from experience that they are easy to compete against

CindyJo440

126 Posts

Posted - 04/30/2008 : 07:58:36 AM

Are you approved with Countrywide? If you are just run it through CWBC to get the approval and they will take that as the "pre-appoval". We have done this several times and it has not been a problem so far.

bbbbenny

239 Posts

Posted - 04/30/2008 : 08:11:59 AM

quote:
Originally posted by CindyJo440

Are you approved with Countrywide? If you are just run it through CWBC to get the approval and they will take that as the "pre-appoval". We have done this several times and it has not been a problem so far.

Exactly! Same here-ran it thru CWBC strictly to provide a "CW" approval and it was accepted as such.

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