“We’ll be selling our home this summer and we’d like to have you handle it. One question: with all the turmoil with banks and the mortgage market, how will we know for sure when we have a buyer who can get a loan?”
Answer:
When escrow closes. Sorry to say, but that’s really the only way to know 100%.
Two main reasons:
1. As you alluded to, there has been turmoil in the lending markets. And this is causing lenders to regularly change their rules and guidelines. So a person can qualify for a loan one day, then no longer qualify the next. I’m seeing it happen on at least 1 in 10 loans during escrow.
2. There are just too many unskilled, sloppy, dishonest and/or fly-by-night mortgage lenders out there. It’s been that way since I started 25 years ago. A “loan rep” tells me a buyer is qualified, but they haven’t asked all the right questions or don’t know the rules and guidelines of the loan program they’re intending to use
I try to eliminate these risks by insisting that anyone buying a home I have listed with less than 25% down must provide a pre-approval letter from a large, reputable lender. This has made a vast difference, but still is not 100% successful.
So, like I said, you’ll know for SURE that your buyer is qualified when I call and let you know your escrow just closed.
