It’s always interesting meeting potential new home buyers.  At some point in the conversation, they will say either:

  1. I’m sorry, I don’t have a mortgage lender set up yet.
  2. I have a mortgage lender that I want to use.
  3. Should I have gotten a mortgage lender first?  I really don’t know what I’m doing.

I always ask if someone has a mortgage lender they would like to use or are currently using.  It clears some things up for me.  For example, if someone’s brother or cousin is a mortgage lender, that’s probably who they are going to use and I needn’t worry about finding a good match for my buyer. 

It’s odd to hear someone apologize for not having a mortgage lender set up in advance of our meeting.  There’s no need for an apology:  No offense has been committed.  In fact, that makes things easier for everyone.  Here’s why:  I’ve seen many new home buyers look at 4 or 5 national lending companies and get their minds tied to a teaser rate or get confused by the information and quit looking for a house before they’ve really gotten started.

Number two is also a fine answer.  If you know a mortgage lender that you want to use, typically that comes with a sense of comfort.  There’s nothing wrong with having a lender in mind or even having applied for a mortgage preapproval before contacting your favorite real estate agent. 

Does the order in which you get a lender or a real estate agent really matter in the end?  My main thought is that if you do go with a lender that your real estate agent recommends, the chances the home purchase actually goes through is some percentage points higher than if you bring your own mortgage lender to the transaction.  If we were to put odds on it though, say 75% chance a deal goes through with a lender a real estate agent recommends vs 70% with a mortgage lender and a real estate agent that have never worked together before.

There are some national mortgage lenders that are notorious for not providing much in terms of client service.  They also don’t tend to follow the dates of the contract, so things like a mortgage “clear to close” letter may not come out timely, if at all.  That can cause other issues like postponed closings.  At the same time, there’s probably a billion different ways a home purchase can be screwed up outside of the mortgage lender so it is what it is.

My preference is to meet with a buyer first, see what they might be thinking as far as the type of home they want to purchase, get a sense of their personality, and then refer them to a mortgage lender who I think will work well with them.  However, I’m totally comfortable working in whatever order the home buyer decides.