Question: I was wondering what is the most a Real Estate Agent can do in assisting someone in obtaining a mortgage? What process do they go through and can they actually help assist you? Any information regarding buying a home/first time home purchase would be helpful.
Answer: My name is Gordon P. Allen, A REALTOR in the San Francisco Bay Area. Some real estate brokers can do their own loans through “Processing Centers,” which allow the r/e broker to offer as much service as a typical mortgage broker. This means that your REALTOR can also be your “loan officer.” If the loan requires special handling (i.e bad credit and other circumstances), then the loan giants like Citibank & Home Savings may be your best bet. I’ve done several this way, but sometimes I refer a loan out to tho se that specialize in loans, like FINET etc.
Otherwise, a relationship should exist between a REALTOR and several loan agents, and the REALTOR can recommend which loan agents to talk with for the best rate and terms for your needs. A real estate agent can help in many ways:
An agent can calculate exactly what size of mortgage you can qualify for based on your current income and debt load. Based on this calculation, an agent can of course match your financial means with homes that would be feasible for you to buy. Perhaps more importantly however, this calculation can be performed without reference to any financial institution. This could prove very useful if a mortgage application might prove to be ‘iffy’ due to past bankruptcy or slow payment of prior loans. If this were the situation and the individual applied to a bank and was turned down, this could be traceable by a second bank and could taint the individual’s record. Good real estate agents are dealing with numerous mortgage applications throughout the year and in this type of situation could direct the borrower to a mortgage broker they frequently work with, or even a private lender.
Some agents often work regularly with mortgage brokers and may be able to secure better rates or relaxed qualification rules.
Some large real estate companies have alliances with major financial institutions and can obtain mortgages at preferential rates for clients referred by them. For instance, in Ontario, Re/Max has such a relationship with a major Canadian bank. This relationship can yield mortgages for Re/Max referred clients that are 1/2% to 1.0% lower than posted rates!
While these comments are based on my experiences working in the Canadian real estate market, I’m confident the situation in the US. will be very similar.
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