So… a new issue has been coming up … It seems that in a few reported cases, seller’s agents have been reaching out to the buyer’s lender to talk about their qualifications to buy. Either to talk about the scope of their pre-qualifcation, or to discuss the buyer’s ability to buy. First, know that it is 100% inappropriate and against all privacy laws for the lender to provide you ANY information on the buyer’s finances. The lender wants very much to assist you and is put into an extremely uncomfortable position. Not only are you not the buyer’s representative, they can’t give you the information you seek and really have no right to know the nitty gritty of the buyer’s financial situation, without express authorization from the buyer.
If a seller’s agent asks the buyer to allow them to talk to the bank directly – buyer’s agents should urge extreme caution giving anyone permission to talk to their client’s lender or attorney! But why is this happening? If there is a pre-approval, the bank has done a series of checks to issue that letter. If you don’t understand what has been verified in the process, talk to the lender in general terms so you can properly advise your seller of the limitations of the lending verification of income or debt – that information is universal and should not be client specific. If the offer did not come with a pre-approval it still must be submitted to the seller (yes, that came up this week as well), and the seller is free to counter the offer with a requirement that a pre-approval is obtained within a reasonable time period. It’s a two way street, and working together with your fellow Realtors is critical in this time of a booming market and tight inventory. While I know all seller’s agents want to vigorously represent their client, they can’t trample the rights of the buyer in doing so. And buyer’s agents should make special efforts to communicate well with the seller’s agents during the lending process so there are not concerns or questions that make them want to call around for answers.
As a reminder, all Realtors should limit their own communications to their clients and their client’s representatives. Thank you!