Frozen in pre-approval limbo

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Frozen in pre-approval limbo

Ken Wheeler
Member since 2021 · 1 post · 0 votes

Newbie out of state investor here and hopefully my question makes sense (still learning terminology). After you get pre-approved with a lender, how long are you 'stuck' before you can pull the plug and look in another area for property using a different lender? I spent about four months doing my homework in a market prior to getting pre-approved. Now, about six weeks into my 'serious-ready-to-buy-search' it's looking like slim pickin's isn't going to change any time soon. I don't want to jump into another market and try to get pre-approved due to the hit on my credit score. Are there other options besides "you're stuck for 90 days"? 

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Nick BelskyBusiness Member
Residential and Commercial Broker · Member since 2021 · 1k+ posts · 704 votes
4y

@Ken Wheeler

At no time are you ever "stuck" with a lender.  I've seen borrowers bring 2 or more lenders to the closing table then choose at the closing table.  Don't recommend doing it, but it is perfectly legal. 

As a mortgage broker, I get nervous 2 weeks into a loan if the lender isn't performing up to par or as quickly as expected.  I will pivot and pull the loan out and move it to a back up.  I always have at least one back lender on board.  I rotate them and they know who they are and what their current position is.  

The point is, if the lender you are with isn't getting the job done or you found a better one, switch!  Many lenders are able to lend in various locations.  Is your current lender not able to lend in the new market you are looking into?

Cheers!

[email protected]
Belsky Mortgage, LLC526 Reviews
WebsiteView Page
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  • Reid Chauvin
    Lender · Nashville TN - Licensed in AL AR DC FL GA LA MD TN, TX and VA · Member since 2021 · 583 posts · 338 votes
    4y

    You should be fine to get pre-approved in your next target market. Having your credit pulled a second time is going to do very little to no damage to your credit score. There is no reason to hold off your search in a different market. 

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  • Nick BelskyBusiness Member
    Residential and Commercial Broker · Member since 2021 · 1k+ posts · 704 votes
    4y

    @Ken Wheeler

    At no time are you ever "stuck" with a lender.  I've seen borrowers bring 2 or more lenders to the closing table then choose at the closing table.  Don't recommend doing it, but it is perfectly legal. 

    As a mortgage broker, I get nervous 2 weeks into a loan if the lender isn't performing up to par or as quickly as expected.  I will pivot and pull the loan out and move it to a back up.  I always have at least one back lender on board.  I rotate them and they know who they are and what their current position is.  

    The point is, if the lender you are with isn't getting the job done or you found a better one, switch!  Many lenders are able to lend in various locations.  Is your current lender not able to lend in the new market you are looking into?

    Cheers!

    [email protected]
    Belsky Mortgage, LLC526 Reviews
    WebsiteView Page
    1Reply
  • Tom S.
    Real Estate Investor · Burlington, VT · Member since 2010 · 2k+ posts · 1k+ votes
    4y

    @Ken Wheeler  As mentioned above, typically there is minimal score damage from shopping around with different lenders in different areas.

    I just went through the process of refinancing 2 rental properties for a cash out refi, to use as the downpayment for my own home.  I had credit pulls in March, Aug and Oct for the primary house (still pre-approved and searching, the market is tough).

    I had 3 pulls from two other lenders for the rental refinances, in June, July & Oct, and in the end, my score is almost exactly the same.

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  • Catherine Coy
    Lender · Huntington Beach, CA · Member since 2008 · 154 posts · 30 votes
    4y

    << After you get pre-approved with a lender, how long are you 'stuck' before you can pull the plug and look in another area for a property using a different lender? >>

    Loan pre-approval applies to you, not the property, to a specific maximum loan amount.  If you're satisfied with the lender that approved you, you can stick with them until you find a property, no matter what market you end up in.

    BTW, conforming (Fannie Mae and Freddie Mac) loan limits increased today in every market.  Here's the announcement.

    https://tinyurl.com/yzy4nwce

    Catherine Coy

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