My lender didn't give me a pre-approval letter until I found a house. Should I be concerned?
The downpayment % is a little higher than expected, and I feel I may have shopped around if I'd known this originally.
Always shop around on your first few deals. The pre-approval probably isn't as big of a deal as the down payment %. What type of financing are you using (FHA, VA, Conventional), what type of purchase (primary residence, owner occupy, investment, or house hack) and what's the down payment %?
The first one is the hardest. If You don't have any history with that lender. bigger downs and higher interest rates are expected. As you grow with your real estate career, the lenders will get to know you and be a little more lenient.
As far as a lender, If you don't get what you need to do a deal. Go out the door, look across the street and usually there is another financial institution, go in say HI , and ask who is the portfolio lender? Do you have any foreclosures on your books you need to get off of them , and they will be more than happy to talk with you. It is a win win for both of you.
Always shop around for your business. as someone once told me years ago. "You make your money on the BUY"
Thanks Adrian. It would be an FHA at 5%. Not a huge difference, but original terms discussed were 3.5%. I never received an approval letter, but the broker recommended an agent and gave them the terms of my approval instead of me. Makes me question how much I can trust the lender for no future surprises.
@Asya Evans yeah that's an interesting situation. 5% on FHA is still great, especially if it's a 2-4 unit so I wouldn't let that change get to you. A lot of times those things are out of your lender's hands and more on the underwriting team. Something similar happened to me... essentially the lender made a mistake thinking I would get approved for 3.5% FHA on an owner occupied duplex, but underwriting came back and wanted a higher down payment. Sometimes these things happen and don't necessarily make the lender unreliable.