I did a preapproval recently for a veteran. He came back from Afghanistan and immediately went back to the job that he left prior to being deployed. One of his goals upon return was to purchase a home for his family. Even though he was well qualified, he had very little in the way of savings.
We went over a comfortable monthly payment, which was near what was being paid for rent. He told me that his mom had given the name of a real estate agent that was working part time, but he felt obligated. I did a preapproval for him and included that they were looking for the seller to pay for closing costs and also referred a home inspector, attorney and insurance agent.
The following day I got a call from his real estate agent, asking me what right I had to put into a preapproval that this buyer wanted to have the seller to pay the closing costs. I probably would have talked the issue through with her, but when she said that guys like me caused the entire subprime fiasco. I told her, I didn’t realize that I had that much power, which totally put her over the edge. Not sure what else she said as she was hanging up on me.
I got a call from my client shortly thereafter asking me for a Realtor referral. He told me that the real estate agent went off on him, after she got off the phone with me. I’m sure that conversation didn’t last long.
The issue of seller paid closing costs has been around forever. Market conditions and area will dictate what is possible. Is it always possible, absolutely not, but my preapproval has to be based on the needs of the buyer/borrower.
