By Selwyn S. Jamurath
Since the market has picked up quite a bit and homes are more affordable than ever, I thought I would talk about the important relationship between the realtor and loan officer.
Most peoples first impulse when thinking of buying a home is to look in the newspaper or a real estate magazine, find a home that is appealing and then call the realtor that is listed on the ad. Others call their loan officer first to get pre-approved for an amount before even looking at homes. Whichever way you choose is fine as long as you understand how the realtor and loan officer will work as a team to get you into your new home in the most efficient and least time possible. Many of you that are familiar with this process from years past may notice that is very different today because of the current “Credit Crunch” in the financial markets. Here is a brief explanation of how this relationship works.
Realtors look to loan officers to guide them in the right direction when it comes to finding the right home that fits into the client’s budget. This is where being pre-approved comes in. The loan officer is dealing with the financial aspect of the transaction and the realtor is working with the human aspect of the transaction. They must both work together well to make your situation a “Win” for you.
Realtors will typically call up a loan officer to get the financial ball rolling and the loan officer will often count on the realtor to assist in obtaining basic information about a client that will make the loan process easier.
Once the client is pre-approved, the loan officer conveys that information to the realtor in the form of a pre-approval letter, who then begins the house hunting adventure. At the same time, the loan officer continues to work with many banks to solidify the loan commitment and provide as many options as possible so that the client get’s the best loan for their situation. The realtor will also provide escrow information and the preliminary Title report to the loan officer to ensure that the property is free of any liens on the property that would prevent its sale.
The realtor may write up several offers on homes and one may be accepted by the seller. Once this occurs, the realtor sends the purchase agreement back over to the Loan officer so that an appraisal can be ordered on the property once the appraisal is completed.
Being pre-approved at a certain interest rate is not guaranteed until the loan is locked. When the loan is locked, the interest rate may be the same that day or a little different. The loan interest rate can be locked after the bank performs an appraisal review as a double check to confirm the value of the property. While this is going on, The loan officer is also communicating with the realtor to obtain recent documents from the client. This is usually when the bank will condition the loan officer to obtain additional documents from the client. These conditions must be met before a bank will issue a final approval.
This seems to be the critical point in the transaction where the loan officer will communicate to the realtor a realistic expectation of when escrow will close. Today, banks operate in an entirely different way, and nothing is guaranteed. There are usually hiccups along the way, and good communication between your Loan officer and realtor is paramount to navigating those obstacles.
Your loan officer will ensure that your final documents, which require your signature, are delivered to the title company before close of escrow and communicate that to your realtor. Your realtor will then setup an appointment for you to sign your “docs” and your loan will fund and record in a few days, unless additional paperwork is required by the bank from you to close. If so, then your loan will close shortly after those conditions have been met.
GC Financial Services and our realtor partners can assist you with all of your financing and real estate needs. We’ve partnered with only the top, most reputable realtors in the area. We can answer your questions so that you’re able to make an educated decision and ensure your home buying or refinancing experience is a rewarding one!
Selwyn Jamurath is Branch President with GC Financial Services, 200 Broadway Suite 84 King City, CA 93930, (831) 385-7848 x119, www.selwynassociates.com or email@example.com