Except they do need a preapproval letter. Moreover, sometimes the preapproval letter is not enough. Before a seller accepts an offer that involves financing, the seller wants to be assured that the buyer has applied for a loan and is qualified to get a loan. Although a preapproval letter implies performance, it is not a guarantee.
Lately, my sellers and I have been including a request to look at the buyer's DU before the sellers accept an offer. That's because I've seen preapproval letters that should have never been issued in the first place, and mortgage brokers who have been unable to perform from the very inception of those letters.
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At the time of writing, Elizabeth Weintraub, DRE # 00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.
Comments
I am sorry, but what is a buyer’s DU?
Thanks, really enjoy your blog.
I can see I have to add a DU to my glossary. Thank you. A DU is an abbreviation for “desktop underwriting.” It’s a print-out showing the borrower’s financial information, including FICO scores.
I LOVE YOUR BLOG!!! Realtor here in OKC..this one hits HOME! Having to deal with what I thought was a Lender with a good rep. Loan Officer was new… They pulled a GAP check 1 week before closing & SUDDENLY buyer is not able to proceed!!! I have hear so much crap I am sick of it! How can you have the scores & be ok only to pull for a score again & your score dropped??? A lot of mixed message from other leders & tried to get buyer(buyer is not mine) to another leder who was willing to help & score is below 600…Buyer says charges are not valid & has filed a police report in person who did the charging…it’s BAD!!! I am going to see if I can get proof of scores here in OKC from now on…prob. won’t work but what can we do to protect our sellers who with good faith think they have a good buyer on the line???
You can ask as I do in the confidential agent remarks in MLS (which the seller approves and signs) that the seller would like the DU to accompany the offer. If you have a good mortgage broker with whom you work, and you most likely do, then ask for help to decipher the DU.