Preferred Lender Nonsense

Builders, Condo Buildings and unfortunately some Real Estate companies have preferred lenders. Is this really good for the buyer, ah no. Listen up Realtors, Builders and Condo Buildings, don’t be afraid to learn and use the services of other mortgage lenders who know the business. Some point to the rule of 3. Have 3 people in any given industry ancillary business who are great and let the client pick. Builders and Condo units most can argue are the worst. First of all Builders who have an in-house lender and refuse to pay for title and other seller paid standard paid closing costs should be illegal. It is ethically wrong to force some into a worse mortgage and make them pay more fees. Condo Buildings, same thing if you refuse to pay for certain credits toward the buyer because they choose to attain financing elsewhere which is better, shame on you. Brokers and Owners of Real Estate companies, why force or drive your Realtors to use a preferred lender when it might not be in your buyers best interest. Secondly why not let your agents develop their own relationships with mortgage lenders who can offer better service and rates to your clients.  I remember when I first started out in the mortgage business with refinances only, thanks Research Lending. We had to use one title company which was OK but nothing special. I now use primarily two title companies and try out others from time to time. The point being why limit your business circle to one partner. Sure, if you work with someone your comfortable with or maybe not so comfortable but you know they do any amazing job stick with them. If not try someone else, and if they don’t work out get recommendations for other good business partners. For condo developments, if your lender has an in-house program because you have a mixed use building or a niche product your doing the right thing, but sadly most of the times this is not the case. For larger real estate companies like Keller Williams and JB Goodwin to have a preferred lender makes one wonder why? Why not let your agents choose? How does their business relationship with one particular lender benefit the buyer?