NationStar requiring Buyer to apply for pre-qual with NationStar.
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Permalink Reply by Mark on
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yes, you CAN blame Nationstar - in my case the investors have already approved the deal.
Nationstar has a legal obligation to the investors to close the deal, not to pile on "requirements" that will delay the deal, or make a willing & able buyer go away, leaving the investors with a lower net at a trustee's sale.
"Requirements" that they WILL waive if the seller's agent (YOU!) raises a fuss.
You're making your own job harder by "just going along with it".
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Yes I we see it everyday in foreclosures. Buyers usually just suck it up and get the 2nd preapproval... otherwise they don't get the property.
The type of backbone needed here goes way beyond what one Realtor could accomplish. It would need to be a national movement, with NAR backing... or at least start at the state level.
I agree that writing your congressional representatives may be a good way to start. It won't help a buyer get a particular property, but it could change the practice in the future.
Also I have been told credit score checks for mortgages are not hard pulls on credit... at least not a few of them. But I really don't know.
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Permalink Reply by Michael Schneider on
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Seems like a sketchy requirement, tying an "application" for credit by the buyer, to the approval of the seller's short sale. It feels like a potential violation of something: TILA, FCRA, UDAP....
This goes beyond what is needed to verify that the buyer is a bona fide buyer.
My first reaction is that Nationstar may be circumventing FCRA so that they can pull the buyer's credit report, for which they may not have "permissible purpose". I would certainly wave this flag.
I would tell them to pound sand, if I were the buyer.
BTW, I believe that there are/were rules regarding multiple hard-inquires for mortgage credit within a short time period, so the "series" is treated as one inquiry.
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actually, applications within a 15-45 day window (depending on the scoring model) are lumped together - on day 16 or day 46, it's a "new" inquiry, and it knocks up to five points off your score.
Since we already did a pre-qual back in February on this property, this is a "new" inquiry, and since there's no way Nationstar can/will close within that 15-45-day window, we'll have another inquiry when they get around to "approving" the file - that could be 15 points from our score for this one deal.
Add in the inquiries from the other (slow) short-sale we purchased earlier this year, plus the offers we've submitted for other properties (that all required pre-quals submitted with the offers) and 800+ ficos get dangerously close to 759 ficos, with higher mortgage rates attached.
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Permalink Reply by Mike Mondy on
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.............
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Permalink Reply by Bryant Tutas on
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Great discussion guys. Interesting to read the comment about Nationstar offering to pay closing cost of the buyer uses them. I would be curious to hear a legal opinion on this. Maybe some of our attorney members will tune in. This is much different than a seller requesting the buyer use a specific lender for qualifying as with a REO.
Mark, Thanks for sharing your experience and perspective. This is why this site is open to all and not just agents. It helps us agents become better at what we do when we can see things for the consumers perspective..
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On one of my own, personal properties, I have a mortgage that offered to pay our closing costs should we agree not to pay it off or refinance within a 2 year period. This was a "normal" lender, so it may be that NationStar was simply offering the closing cost assistance to any mortgagor-to-be. I don't know the results of completing the NationStar app as both of my short sale files which came to that point led to a buyer "walking" on the deal. I still have one of the two properties that is waiting on a new buyer. The listing agent already has a copy of the application to submit at contract time. That way, we are hoping to eliminate asking for this item at a critical stage in the game when the Buyer is already tired of waiting and possibly looking for a way out of a contract.
I am a short sale coordinator for a real estate law firm. Our firm does not get paid until the closing takes place. If a lender asks for something that a buyer is not willing to provide, I do what I can to keep the buyer in the contract - keep the peace and still keep it realistic. It is in EVERYONE'S best interest to assist the short sale file to the closing table.
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Permalink Reply by Janine Margaret Nielsen on
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Here is how you get around the Nationstar requirement of getting the buyer to cross-qualify-
You have the buyer's lender submit a DU approval(full committment to lend) and you send with the PQ letter.
You also have them partially fill out the Nationstar application(names, addresses, birthdates, and last 4 off ss#s)
at the bottom have them sign but fill in that "We respectfully decline this application".
As you can see from my negotitors response below it is perfectly acceptable.
The last thing is the buyer prequal. What you uploaded looks like a full commitment to lend. If it is I will not need the buyer to get a prequal thru nationstar. If it's not we want the buyer to be prequaled thru Nationstar to make sure we are working with qualified buyers. Please advise.
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Permalink Reply by Melanie Carney on
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I tried this tactic too but did not have the same results :(
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yes, I've experienced the same strongarm tactics. They did actually close out a file when our buyer refused to cooperate but I was able to have it reopened once she agreed. Unfortunately there isn't a way around it from what I can tell, they want to make sure that the buyer is bonafide and you're not wasting their time or committing fraud. I would just notify my buyers upfront and perhaps put a notice in the listing remarks. FYI The buyer doesn't have to go with their financing in the end.
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I had the same situation. The Buyers had their own lender and did not want to fill out the application, which brought us to a stale mate. Buyers eventually had to fill it out and we got an approval. Buyers stayed with their own lender. I believe this is standard practice for them. It is just annoying that they don't give you the heads up sooner. It's smart if you are listing a short sale that is with Nationstar, to have that application in the MLS. Now we all know!
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Permalink Reply by Tracy Hatchell on
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Guess what everyone!!!! I got an approval on my short sale from NATIONSTAR!!! Fought the issue about them not forcing the buyer to apply through them. Told them they are in violation by doing so. They asked for the underwriters conditional approval from the buyer's lender showing what stipulations had to bee met. Gave it to them. Gave them updated bank statements. Got a message today stating that they are issuing the approval with NO deficiency judgement and no note at closing!!!!!!! Just stick to your guns and do what is right!!!! We cannot allow these banks to bully our sellers nor our buyers!!! Good luck everyone!!!!! Another one bites the dust!!
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