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Weber Mortgage is YOUR Preferred Lender

Many Builders offer incentives for using the Lender of THEIR choice.  Why would they do that?  What is the benefit to them?  What does it cost you (if anything)?  What are the upsides and the downsides?  How do you protect yourself against getting taken advantage of?  Here are the answers to these questions and more.

 

Preferred Lender FAQ

  • Why would a Builder have a Preferred Lender?

    • There are several potential advantages to Builders if they have Preferred Lenders.  The Lender(s) may contribute financially towards marketing expenses.  They may also contribute towards incentives for buyers who are buying the home (such as closing cost credits).  Preferred Lenders also may add additional advertising/marketing through social media promotions.  All these things help the Builder, but do they help YOU?  The answer is “maybe”.
  • What does using a Preferred Lender cost YOU (if anything)?

    • This is going to vary depending on the Builder and the Lender.  Ask yourself this question: if I believe that “nothing is free” then what am I paying in order to get these Preferred Lender incentives?  Each builder/Lender relationship is negotiated differently so the only way to find out is to ASK.
      • Ask the Builder’s representative (Realtor) “What does the Lender contribute towards my closing costs (or other incentives)?”.  This is a fair question.  If they contribute anything then only two things could be happening:
        • The Lender could be making a smaller margin since they are getting multiple loans from this Builder.  If this is the case it might really be a good deal.
        • Or, the Lender is simply offsetting the expense of contributing by making more money somewhere else in the loan (inflated rates, inflated fees, etc).
      • Ask the Preferred Lender what they are contributing.  If they say nothing or get you the feeling they are uncomfortable answering the question then red flags should go up.
      • Ask the Preferred Lender if you would be getting the same rate and fees if you were buying a re-sale property instead of new construction.  Again, you will probably be able to tell if they aren’t being 100% truthful with you.
  • How can you find out if the Preferred Lender is giving you the best deal?

    1. Ask!  See the point above for questions to ask the Preferred Lender.
    2. Compare!  Get a quote from the Preferred Lender and then call Weber Mortgage.  We’ll ask you a few basic questions to understand your specific needs and then we’ll let you know if we can beat their deal.  Many times we can!
  • One more thing to consider:

    • This is VERY important!  The Preferred Lender’s allegiance lies first with the Builder.  That Builder is probably going to be the source for dozens of loans for the Preferred Lender each year.  Your Lender is required to protect your privacy and NOT divulge personal information to anyone else in the transaction.  If something happens during the loan and/or build process do you think the Preferred Lender will side with the Builder (who is sending them LOTS of business) or YOU?  Hopefully, they will follow their legal responsibilities and side with you, but why take that chance?  If you bring your own Lender then they have no allegiance to the Builder and should definitely be in your corner.

 

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