Rockland Real Estate Perspective


Mortgage Pre-Approvals and First Time Home Buyers: Lesson Learned!

In 2009, I've been working with a lot of first time FHA buyers in Rockland County who are looking to take advantage of the great deals on real estate and low mortgage rates to get into a starter home now. I think they are smart to do so! I'm careful when working with first time buyers to explain the home buying process as thoroughly as possible so that buyers know what to expect when buying a home in Rockland County.

I always make sure buyers get a pre-approval, and refer them to several excellent local lenders if they haven't been pre-approved. If they come to me with a pre-approval from a lender I am not familiar with, I have the potential buyers speak to one of my lenders just to be on the safe side.

Boy, did I learn a great lesson last week! A delightful young couple called me, looking to buy a starter house in Rockland County. I did a phone interview with them, and found that they had a pre-approval from a major national lender, one I often work with locally. "Great," I said. "Bring that pre-approval with you when we meet to see houses."

The buyers drove to Rockland County, but forgot to bring the pre-approval. No big deal, I could get it later. We spent the afternoon together, and looked at 11 houses. Two of them were as perfect as a starter home can be, so I wrote up the offers for the buyers.

I was startled when I got the pre-approval letter. I had assumed that because the buyers were pre-approved by a major national lender that I work with all the time, that the pre-approval letter would be the same one they would have been issued if they worked through a representative from Rockland County. These buyers had been approved in another state. What they gave me was not a pre-approval, but a pre-qualification letter, and no experienced real estate agent in Rockland County would accept it. So I had them call the local representative that I use.

Shocker. The person who issued their pre-qualification letter didn't talk to them about closing costs, pre-paids, or tax escrow. The buyers were shocked to find out that it would cost them about $1000 a month more than they thought to own a home, and they decided they had to save more money before purchasing a home.

I was glad I sent these buyers to a mortgage lender I know and trust -- it saved a lot of potential heartache. I also learned not to blindly trust a brand -- I need to dig a little deeper if I don't have know the person who issued the pre-approval letter.

This experience made me really appreciate the integrity and professionalism of the mortgage lenders I work with, and realize that I do work with the best. And I have a new best practice: Make sure to have a copy of the pre-approval in hand before even scheduling an appointment to view houses.

jennifer mallory | associate broker | "real integrity in real estate"
keller williams hudson valley realty II | 130 Main St, Nyack, NY 10960
845.521.3135 | 845.323.6247 mobile |

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Comment balloon 0 commentsJennifer Mallory • July 25 2009 08:16AM