If I Choose a Realtor, Do I Need to Use Their Lender?

The answer is not crystal clear when it comes to using the Realtor’s preferred lender. You need to be certain that the lender you use works for you and not your agent. You are need to have honesty, the means to close on the agreed upon contract date and a well-informed lender who can provide you with the information you need to select the right loan product.

It does not hurt to consider your agent’s recommendations, but you need to discuss your situation and objectives with them yourself. Your realtor is not your lender and your sensitive information should not be communicated through them. If you feel comfortable with them and that they are unable to keep your financial information private from your agent or are more loyal to the agent than you, it is better to start looking elsewhere.

A recent survey was taken asking home buyers what part they do over during the home buying process.


Almost half of them wished they would have devoted more time searching for a lender. They felt that they were required to use their realtor’s lender. The same comes up when using a new home builder too.

One way to avoid this problem is to find a loan officer before hiring a Realtor.  If you know someone who bought a home. Ask a friend for a referral, or a co-worker, etc. that had a successful experience with a loan officer. Someone who can guide you through all the scenarios, best-case or worst case.  In fact, some loan officers were former Realtors so they have intricate knowledge of both processes.

Having said that, if you choose a lender that your Realtor does not know, the Realtor may become very nervous at the thought of you using someone outside of their control. Their commission is on the line and they have no proof of the loan officer’s closing experience.

The real estate agent may tell you that they want you to use their lender for financing because they will provide the best service and possibly even the best rate and terms. This could certainly be true but more often than not, the truth of the matter is they want you to use their lender so that they have a sense of control. More control and communication from their lender means their commission is less in doubt.

Some lenders refer buyers to a Realtor and the Realtor will sometimes reciprocate their home buyer prospects to the same lender. Quid pro quo, right.  There is nothing pro-consumer about many realtor connections to their favorite lender. If they refer you to a big bank, they are notorious for not having a wide enough product selection.

A good Realtor should have 3-4 lenders to recommend and if you don’t feel comfortable with any of them, or they don’t offer the loan program you want, you are still free to shop for one you do feel comfortable using and has the right program for you.