How to do price match between 2 LENDERS

Question

Borrower currently goes with LENDER A, but LENDER A ends up with very high interest rate and fee.

To do price match, I would like to ask whether I need to show LENDER A the lower rate & better fee from LENDER B's rate engine on their portal?

or if LENDER B's approval and CTC are required to match the price?

and is it legal if LO submit one file to 2 different lenders at the same time?

Devin Peterson · Answer

Hi Vu,

First off - Local to you here in St. pete. Would love to connect.

Secondly, NEVER run two files at once with two different lenders. It will cause mass confusion all around and make more work for all parties. If you are shopping lenders, do all of your comparisons and discussions first. Do not go back and forth in the process and string two lenders along at once.

Last, I am confused what you mean by show lender B CTC and approval to match the price. You are working with a broker - OK, Yes, they can technically have two files running at the same time but shouldn’t do that in the wholesale side again because it’s just out of respect, and two it sounds like this may be a float vs lock situation? Just remember, if your broker locked you in for a rate. You are locked in for that days pricing not just the rate. There is no final “price match” you can get generally until the closing date is established, rate is locked, and all fees are balanced. By that time you might as well stick with who gave you the CTC. Hope that helps! Good luck!

Erik Estrada · Answer

If your goal is to constantly be on the grind searching for the cheapest lender, and potentially falling out of escrow each time then go this route. If you are looking for a partnership with your lender, avoid nickel and diming.

If you look at people as a simple transaction, they will treat you like one. At the end of the day, your lender does this for a living to provide for their family, and by you wasting their time and doing a double application with another lender you are just being selfish. It's not good business practice at all. Is it legal? Yes. Is it ethical? No way.

You are much better off applying with your bank if the goal is to minimize fees and get the lowest rate.

Jacob Sherman · Answer

Its not a good practice . You pick a lender according to whom you'd like to establish a relationship with . Some may tell you they can do it and then it falls out .

Derek Brickley · Answer

Hi there!

Yep definitely not a good idea to have two in process for the same property.  Depending on the lenders, there is a chance that the investor on the back end could notify the lenders that there are two open files for the same property in which case you would have some explaining to do.

For shopping price, feel free to show lenders your Loan Estimate and see if what they offer compares.  Note that you may need to submit documents to them, but do not sign another loan estimate/intent to proceed unless you plan on switching, in which case you need to notify the other lender ASAP.

David M. · Answer

@Vu Le

Not sure what you are asking.  You shouldn't be applying for two loans simultanously.  If its the same loan product, you are looking at the rate terms (interest, points, lock time) and lender fees.  Pretty much everything else is out of their control.  Even the rate terms can change daily, and for example dependent upon the rate lock time.

To me in the end, I am looking for the loan officer that provides the best service.  Unfortunately, that may require doing a deal or two --- as with many profesionals/trades.

Good luck.

How to do price match between 2 LENDERS

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