Why Large Bank Lending Could Cost You Big

Recently a client of ours went to a big bank (rhymes with “mace”), filled out an online loan application, and received an automated instant loan approval. Then they found a home on their own and called us to assist them with the negotiation and purchase process. Unfortunately for these buyers, who wanted to write an offer on a weekend, the lender was MIA. Big banks don’t work weekends or holidays, so buyers are unable to get clarification from them on payment amount, closing costs, etc. And with an automated pre-approval, who do you even call?

The seller received multiple offers on this home, above asking price, and our clients did not know how much they were able offer and still afford the monthly payment. This is like buying a house while blindfolded.

You could argue that the lack of “service” from a big bank would be made up through a lower interest rate and lower fees…but you’d be wrong. The rate was at least 0.25% higher, and the upfront points to pay in order to get that higher rate was almost $3,000! In addition, the amount the big bank pre-approved these buyers for would’ve crippled their financial situation and possibly ended up with the house in foreclosure in the future.

Don’t put yourself or your friends/family in this situation. When you work with Team Harry Realtors and Renaissance Lending, we are transparent about every cost, interest rates, and your estimated monthly payment on every house we show. You will know the cost of that home before you walk in the door of your first showing. No other Realtor® or lender can give you that kind of transparency.