What the heck?
I have been running across more and more stories about buyers/borrowers being charged upfront for services.
I can't believe people get away with it.
Recently, I had a question from someone wanting to get preapproved for a loan.... she even found a house already.... and the loan officer she contacted first asked her for $15 to pull credit. Now, let's forget that that is probably not the 'actual' cost..... which is all that should be charged. But UPFRONT? No, I am sorry.... I cannot hold my opinion back. No fee should ever be charged upfront. One exception ,might be for an appraisal when it is ordered. I do try to get my borrowers to pay for it at the door.... I have been stuck with that fee before.
I see application fees all of the time. $100 - $500 and people actualy pay it.
I even saw where one realtor asked for a $100 retainer from a buyer before he would go show houses.
I eat a couple of credit reports per month. And it costs me money to run a file thru Fannie Mae for approval.... I even eat a few of them too. But I will never ask my client for money upfront. And I will certainly share that information with anyone who will listen.
Is this just part of the changes in this industry? With the discount brokers and internet business?
I embrace technology and change. But some things should remain the same.
With the price of gasoline and the time involved with showing houses, believe it or not I have been bouncing this idea around!
Great post Tom!
I never charge anything up front and I have a promise to ALL of our title companies, termite inspectors, appraisers, etc., if the thing doesn't settle, I pay their expenses.
That way, the title companies pull the title reports when we give them the file and not 4 days before settlement. The termite inspectors get out and get the job done quickly without waiting for the buyer to pay them at the door. The lenders guarantee payment to the appraisers and we get quick turnaround service.
The only person working on a contingent fee is ME. I'm willing to take the risk because we sell a very high percentage of our buyer/clients. If I have to eat a termite or home inspection appearance fee or abstract from time to time, it's not going to put me in the poor house. In fact, I get tremendous service.
Lenn
Renee
thanks for your comment. and i may not be a typical buyer.... but if i were to call a buyer's agent today and they asked for an upfront fee... i would find another realtor.
maybe lending is different enough that i dont get it.
i dont know. but i know how i would feel about upfront fees.
kind of like walking onto a car dealer showroom and them asking for $20 before the test drive.
Our office charges $295 for servicing the transaction...but it is payed at closing...and I give half of that BACK to my client.....
;-D
Tom,
I agree if I were a buyer and someone wanted me to pay up front, I would look else where and ask them to rethink their policy. Thanks