Do all realtors want a pre-qual before showing?

22 Replies

We are wanting to look at a couple places in Florida next week. We asked to see two properties and the realtor wants us to pre- qualify before she will show those to us. It seems that lately when we ask to look, we are always told we need to get pre qualified before they will show them. Is this normal these days. We don't want our credit checked jut to look at a house or condo!

Jack and Cheryl

@Jack Middleton

I am not a realtor but I would say yes. They don't want to waste their time if the buyers are not qualified or cannot close.

If you pre-qualify, you could request the lender that they don't pull your credit and put a disclaimer on the letter. 

Or just show the realtor with your proof of funds. 

Yes that is normal. They don't want their time wasted by people who are either not qualified or simply who just want to look at a property. If you want to actually buy a property you shouldn't care if your credit is checked as that is the main reason to actually have good credit.

Conversely if you are that intent, then suggest paying the agent  $200 to show you the property.

In our area every home has many serious buyers and no one will write an offer below asking price. To screen out casual buyers from dead serious buyers it is fairly normal people bring their preapproval letter from major lenders or local known brokers. You come to my office I will outline what it takes to be a partner.

If you want to look around you go to open homes. Those agents want to get paid are too busy to work on deals.

Hi @Jack Middleton

If you're serious about buying a house, get pre-qualified or pre-approved (pre-quals don't pull credit). Agents don't want to waste their time showing you a property to find out you cannot afford it. The only person that can tell you what you can afford is the lender, so how do you really know the you can afford the homes you want to look at?

They also want you pre-approved because of the increased pace of the market. In the instance that you see a place you like and want to put in an offer, your offer should have a pre-approved attached, if not, you risk losing the property. It's happened to me tons of times. 

Buyer's agents work a lot more than a listing agent. So the less work they have to put into a Buyer at the front of the transaction the better. 

Good luck, and if you're in Tampa, let me know!

Not an expert here, but getting pre-approved does not hurt your credit score.

You only get "dinged" when you actually apply for the loan.

Thanks everyone,

I guess I confused the pre-approval with the app.

We went through a loan app. approval to verify our price range a couple months ago, but we are wanting to view a couple properties in Florida, and 'their' lenders are wanting to approve us.

Perhaps I can make sure it is a pre-approval or maybe I can take the qualification from a different lender?

Thanks again everyone.

@Jack Middleton Just to start, I've never been asked to pre-qualify before being shown a property. That being said, if I'm flying out to look at properties I'm doing a lot of homework ahead of time. I'm looking at comps, rent rolls, T12s, etc. Whatever I can get my hands on. That's because I'm not going to waste my money on a plane ticket to just to stare at a property. And to make sure I'm really not wasting my time I am talking to a bank beforehand. The last property that I bought I wasn't 100% sure I would qualify for. So, before I booked my flight on United, I asked for referrals (from the agent) to local banks and I started talking to the bank I've used before as well. Why? I can *guess* what the interest rate would be but you can never trust the marketing on the radio ads. The real interest rate (for me) figures into the cash-flow and has a material impact on the ROI and, this, impacts my offer.

To summarize, no I've never been asked to pre-qualify.  But you should be trying to pre-qualify with a bank so you know the interest rate for various mortgage scenarios into your pro-forma.  If you're a cash-buyer just screen-cap your bank statement online and make sure the full account numbers are blacked out.  Yes, I've done that too.   

Hi @Jack Middleton ,

In general besides possibly wasting the agents time it also disrupts the home owner in alot of ways. They have to clean to show ready again, move the dogs and plan on eating dinner out that night (Unless it's vacant or a HUD etc). I'll show those to anyone at any time but when it comes to having an owner occupied I usually try to make sure the buyer is serious.

As far as having them pre-approve through their people that's up to you. You are allowed to choose what bank/mortgage person you go through (at least here in NY). I will recommend people who I know are rockstars in the industry. They have never pre-approved someone for me that didn't close. Their communication and follow through is amazing and the speed they get things done is great. But if a client wants to use their banker or their cousin Fred or some guy they met in a bar I don't try and change their mind. When they are calling later in the process stressing out because the mortgage commitment isn't in and due by COB, I politely remind them that it's their mortgage guy.

What part of Florida are you looking at? One of my partners just picked up his Florida license and he is going to work NY and Florida depending on the season.

@Mike Cumbie

good one.

Thanks everyone for the information.

we are looking in Jacksonville, and Haines City.

We have elderly family there and are looking for something that we can use when we have to go down there.  My wife will probably need to be there more often in the near future too.

Yes,  pre-qual give them assurance about your eligibility for loan. You can talk with 2-3 lenders and choose one who you think will be best suit for you. Your pre-qual is good for 4-6 month depend on lender.  

Why should a commission salesperson spend time with someone who is not ready, willing, and able to buy?

If you're not willing to demonstrate those things the Realtor is an unpaid tour guide. Agents are busy, there is money to be made.

Here in California, specifically high end parts like Granite Bay yes potential buyers and sellers with agents we've seen request you to be pre-approved (credit checked), not pre-qualified.  Reason here is you are dealing with million dollar homes and nobody wants to work for free.  Also homeowners don't want to have the riff raff going through their homes wasting their time prepping home for potential suitors.  

Now in Idaho (Boise) we are not seeing this phenomena.  If you are breathing any agent here will take you through a home because its a sellers market here.  Approximately 40 people a day moving here.  

  More than concern about my time, one of the worst feelings in the world is letting a client fall in love with a property, only to find out they can't afford it.  I've been there at the beginning and learned from it.  @Jack Middleton - yes, it is normal.  I would take it as a sign that the agent probably has experience in the industry, which is great.  To start, you can most likely do an initial pre-qual based on an application  - that should get you what you need to show intent good faith.   That said, you'll want to get a full pre-approval in place sooner than later if you are intent on making an offer soon.   In seller's markets...you'll need one.  

@Account Closed - You must know different agents here in Boise than I do. :)  

If you're in the market to buy a home get a pre-approval. Why? 

A. Prevents agents and buyers from wasting their own time by working only with serious buyers.

B. Enables to buyer to not miss offer opportunities in a fast paced market. 

C. Forces buyers to realistically understand what their price range is. 

I've wasted a lot of time myself with buyers who never got pre-approvals. But I generally give a new buyer 1 or 2 showings worth of my time. 

Originally posted by @Jack Middleton :

Thanks everyone,

I guess I confused the pre-approval with the app.

We went through a loan app. approval to verify our price range a couple months ago, but we are wanting to view a couple properties in Florida, and 'their' lenders are wanting to approve us.

Perhaps I can make sure it is a pre-approval or maybe I can take the qualification from a different lender?

Thanks again everyone.

 Your Indiana lender (if I'm guessing what is at play correctly) knows jack squat about Florida property taxes, closing costs, normal homeowner's insurance costs, etc, and all those are factors in the "am I qualified?" question. 

Need to be preapproved by a lender local to the state where the real estate is at. :)

@Jack Middleton

Usually either pre-qualification or proof of funds required especially with new unknown clients. Pre-qualification letters usually don't require credit check like a pre-approval letter. And of course Proof of Funds letters does not require credit check either. sometimes that can be a letter from your bank or even a bank or IRA statement.

@Jack Middleton

It is absolutely normal.  You'd be surprised how many people are time-wasters or window-shoppers who want to look at homes they can't afford or have no real intention of purchasing.  If you don't want to do a pre-approval just yet, most agents/brokers will accept proof of funds.

Devil's advocate here.  As home buyers, my husband and I have looked at a lot of homes during our lives.  Only once were we asked to show a pre-qualification.  

We were starting our search into lakefront property near where we live.  We wanted to see a fixer that was priced far, and I mean FAR below value of the house we currently live in.  We live in one of the highest net worth areas in town, so the guy should have had an inkling we were qualified.  

It's not that he asked for it.  It was that he DEMANDED it before he would even talk to us about the property over the phone.  Then he went on to tell us how busy he was and couldn't waste time with tire kickers.  Never asked any qualifying questions.

The house remains unsold three years later.  I have kept his name to make sure I never do business with him.

If you're going to require a pre-qualification before showing a property, use a little finesse and don't piss off your buyer in the process.

Originally posted by @Katherine S. :

  

It's not that he asked for it.  It was that he DEMANDED it before he would even talk to us about the property over the phone.  Then he went on to tell us how busy he was and couldn't waste time with tire kickers.  Never asked any qualifying questions.

 Real estate agents aren't qualified to ask mortgage qualifying questions. They can however qualify if you are a cash buyer or not. 

Back in 2005-2007, and before, you could use a combination of common sense (& fraud as a fall-back) to qualify people for mortgages. No longer the case: about six months ago I had a doctor with a contract guarantying him $20k/mo, but his Fannie Mae mortgage qualifying income was $0.00 per month because his employer gives him a 1099 instead of a W-2 and it's only been 8 months on the job.

I will ask for a pre-approval, but it is not because I dont want to waste my time. Chances are I have already seen the home anyway. I ask because there are many types of loans and some homes may not qualify for your type of loan. Some sellers won't entertain certain loans because they want a quick close or what they feel is a stronger buyer. Ex: with an fha or va loan, condition can be an issue, and some sellers are not able to make repairs and repair loans wont work. Everyones circumstances are different. We are not judging you we just need to know in order to find you what you want. Most condos in my area in FL only qualify for cash and conventional loans since they are not HUD qualified. Having a pre-approval is the only way a seller will accept your offer and I like to go prepared to write one in a very competing offers market so you don't lose out on a home you love. Hope this helps.