How to get a faster Pre-approval Letter from lenders?

Question

Hello awesome BPs

I am trying to have a pre-approval letter prepared as quick as possible as it is a requirement for the offer, that is what I have been told. Looking around redfin have lending product and they can make it faster on such cases, anyone who have used them in the past and how was it?

With the big banks, I think it might take a bit longer time and I am wondering if there is any other way to put the offer. I have suggested a bit higher Earnest money but I doubt if the seller would like that idea. I should not have any problem getting the letter, it is just I wanted it faster.

Thank you all.

Doug Smith · Answer

If I get everthing I ask for, it's usually a matter of a couple of hours...not a couple of weeks. That's certainly way too long. Letters aren't worth the paper they are printed on. Usually, I call the listing agent and say "Let me tell you about Kal. I did his prequalification and we've already pulled credit and checked his income. His debt-to-income ratio is in line. We also have checked and signed off on his bank and brokerage statements. Kal's solid. Now we just need your seller to sign the contract so we can sign off on your property. Send that over ASAP!" A seller and their agent needs to feel warm and fuzzy that you're going to close. That call from your lender is going to make a big difference, so make sure they are doing that for you.

Ben Harvey · Answer

This is an awesome way of doing business by calling the listing agent on behalf of the buyer! Hopefully it brings you more referrals from the agents you work with.

Doug Smith · Answer

I got a call this weekend from a guy that I has spoken to over a year ago about getting approved for a loan. He wasn't very forthcoming with me back then and I had not heard from him nor did I have any documentation from him in the past year. He wanted me to give him a preapproval letter for an offer, but became beligerent when I asked for bank statements and a few other items that we really have to have to truly pre-approve a loan. He was not happy with me. The fact of the matter is, I am putting my name to the approval. If a borrower is forthcoming and provides me with the information I need, I can usually get a preapproval out in a matter of hours. Many will provide letters with no due diligence, but then agents and sellers begin to find out who presents letters based on facts and due diligence and others who present letters that aren't worth the crayon that they were written with. I have no idea what Redfin does with their service, but we feel producing a letter is something that should not be taken lightly. We'll usually issue the letter and physically call the listen agent to tell them what we've done to issue the approval. They need to feel comfortable that the letter that is issued was done so by a competent lender that actually did their due diligence. Be careful who you choose as a lender and make sure they will stand by their approval.

Wayne Brooks · Answer

You want your preapproval to be Thorough, not fast.  We consistently rejected buyers with Rocket Mortgage preapprovals.

Ray Williams · Answer

My first question is what do you want from your lender? A relationship or commodity?

Christopher Jason Lloyd · Answer

It absolutely is!! Earlier this year with one of my clients, we were the lowest of three offers with one of my clients and the seller went with us since the lender could say that he fully underwrites his clients and gets them to the closing table every time without fail.  Makes a financing offer look good as cash when presented right by the LO.  The other two bids were $6000 over and $7000 over.  Ours was asking price WITH an inspection contingency

Ben Harvey · Answer

Awesome, I'd have to agree with some of the other posts on this chain. I can imagine you are going to get what you expect from the larger retail lenders like Rocket, etc. Probably automated service and not another person on the side of the phone. Personally, I like to know the face and that there is someone I am working with on the other line, that's why I usually suggest and work with local lenders or brokers.

Pre-approvals are not "required" but just about every agent I know wants one for two reasons, to make sure you are serious about buying, and if you're looking to show the seller you're a legit buyer, you want to provide as much strength in your offer as possible.

If you haven't tried already, I'd run a pre-approval by someone local in the backyard you're looking in. They sometimes also know really good agents who can help if you need it that are local to the area.

Kal Wol · Answer

Thanks a lot @Doug Smith all things you mentioned makes sense. I have gone through that process in the past twice for my properties and providing documentation the lender is asking is not a problem for me either. It is the timing that takes longer like weeks to get it that I am not comfortable with specially for something interesting coming my way and wanted to put offer immediately.

I have seen some online tools that claim to provide the pre-approval immediately like rocket mortgage and others, but was not sure jump on it immediately without doing some due deligence

Kal Wol · Answer

Yes Sir!

Erik Estrada · Answer

Hey Kal,

Very easy. Just provide your lender with all complete and legible documentation necessary for the Pre-Approval. And be alert for any further documentation needed to process the Pre-Approval.

Work with a lender that is fast and attentive. A general Pre-approval should take no more than a couple of days.

How to get a faster Pre-approval Letter from lenders?

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