Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Economic News

I Will Buy My Toilet Paper at the Store, Not at the Bank!

Loan Officer, hard at work!

Loan Officer, hard at work!

Today,  I was emailed an agreement…

from another real estate agent on an expensive property that contained a very low deposit, a very, very long closing date but worse, a typed letter from a loan officer from a national bank’s mortgage division that basically just said, yea, they’re approved.

Big whoop.

What actually was in that letter was worthless.  Do they think we are that stupid?

The way it works in the world of professional financing these days is that you must have a Fannie Mae DU/DO or Freddie Mac LP approval.

These are not the gold standard, but the only standard (with a couple of exceptions) to show that the client can truly get approved.

I have submitted agreements with the LP approvals and some agents actually did not know what is was.

Advertisement. Scroll to continue reading.

Once I explained it, they got it.

But, remember

Because of the Red Flag rule and common sense, make sure the social security numbers, bank accounts and other personal info is blanked out.

Now, back to that letter……let other agents know that you won’t take them aymore.

That (hopefully) will trickle down to the loan officer that types on the toilet paper and then you will not lose deals because of the loan person’s word processing system.

Now that by the end of next year the loan officers will be licensed, background checked, fingerprinted, tested and continuing educated (except for bank employees- what’s up with that???) the quality will get better.

Advertisement. Scroll to continue reading.

Written By

Realty Reality! That describes Fred, a sharp witted and outspoken realist for the mortgage and real estate world who has appeared on CNBC and NPR's Marketplace along with being quoted in the New York Times, The Wall Street Journal and other media outlets. Fred is the CEO of U S Spaces, Inc/Arrivva (a real estate brokerage firm in PA, NJ, DE and CA) and U S Loans Mortgage Inc (mortgage brokerage in PA, CA, FL and VA), and serves on the Board of Directors and is the Federal Legislative Director for the UpFront Mortgage Brokers. Fred is also the co-creator of real estate startup, a mathematically driven rental search engine. See everything Fred at



  1. Roland Woodworth

    November 14, 2009 at 2:42 pm

    Your title is surely an attention getter. I agree, it’s totally amazing that LO’s at the banks are not required to have a license.

    Commitment Letters should be of value. When you tell a home owner that you have a commitment letter, they expect to close.

  2. Vicki Moore

    November 14, 2009 at 3:18 pm

    “The way it works in the world of professional financing these days is that you must have a Fannie Mae DU/DO or Freddie Mac LP approval.”

    So how do I know when the buyer has this? Can you explain more about what these are?


  3. Ken Montville

    November 14, 2009 at 3:47 pm

    Fred, when I grow up I want to be just like you.

    Here’s my deal as a listing agent:
    1. Seller’s home has been on the market for month’s and they finally get an offer,
    2. The offer isn’t perfect but the Seller is now motivated and wants to sell the house,
    3.The letter doesn’t have all the DU/DO info. It might say (maybe) that the loan was put through DU/DO but most likely not,
    4. It might be a “reputable” institution such as a Wells or BoA or similar bank or credit union.
    5. Said institution (especially if it’s a credit union ) will not provide it because of privacy concerns or what not,
    6. Refer back to #2.

    I only wish I could get Sellers to turn down or send back weak or meaningless lender letters but it ain’t gonna happen. Sometimes, you just gotta roll the dice and hope for the best, keep your eye on the contingency dates and hope you can convince the Seller to void when they’re not met.

    I know it’s not optimal. I know it’s a risk. But, you know, Fred, a lot of the time they work out.

  4. Vicki Moore

    November 14, 2009 at 3:53 pm

    Phone rings. It’s Fred Glick. Huh?

    That was a big surprise.

    Thanks for the easy to understand explanation. I’m trying to keep up with it all but sometimes it’s difficult!

    Now Kent – you’re scaring me here.

  5. Ted Jernigan

    November 14, 2009 at 4:05 pm

    Item # 4 in the second comment names the two lenders we seem to be having the most difficulty getting to close on schedule. We are having best luck when working with midsized mortgage bankers who control their whole process. I also prefer someone who has a track record of closing on time. I have even referred buyers and their agents to my reliable lenders. We are still getting closings done in as little as three weeks. These reliable lenders do run applicants through DU early in the process so we know if they are real.

  6. Fred Glick

    November 14, 2009 at 4:36 pm

    @Ken..the bank or CU is wrong. They can give you the LP Summary page and black out the vital info.

    You just want to see that it is real.

    And since no one gets paid until all is closed, it would seem that everyone would cooperate.

    What some (not all) loan people may be doing (not as much now) is to play bait and switch with their clients and try to make more money.

    That process will die because of the new Good Faith Estimate that locks in the broker/lender costs at a max for the transaction.

    It’s a pretty good idea except that there are a few flaws in the system that need to get worked out.

    I will try and do a full post of that in conjunction with someone that is an expert on it.

    @Vicki- That’s typical for me- extreme high level of customer service! I enjoyed the chat!

    • Benn Rosales

      November 14, 2009 at 5:28 pm

      Trust but verify, your lips to God’s ear.

  7. Real Estate Feeds

    November 14, 2009 at 5:21 pm

    I will buy my toilet paper at the store, not at the bank!: Loan Officer, hard at work!
    Today,  I was emailed an..

  8. RealEstate Babble

    November 14, 2009 at 5:24 pm

    AgentGenius: I will buy my toilet paper at the store, not at the bank! Full

  9. Short Sales ASAP

    November 14, 2009 at 6:38 pm

    I will buy my toilet paper at the store, not at the bank! #LoanMod

  10. Von Dyke

    November 14, 2009 at 8:45 pm

    RT @agentgenius I will buy my toilet paper at the store, not at the bank! ~~What the what??

  11. realdiggity

    November 14, 2009 at 9:05 pm

    I will buy my toilet paper at the store, not at the bank!: comments

  12. Natasha Hall

    November 15, 2009 at 12:26 am

    I Will Buy My Toilet Paper at the Store, Not at the Bank! – Loan Officer, hard at work! Today,  I was emailed an ag…

  13. John Badalamenti

    November 15, 2009 at 7:53 am

    As a listing agent, it is also prudent to call the lender (what Benn states above, “Trust but verify”); I want to hear from the lender’s lips in addition to what’s on paper (or TP 🙂 . And if I can’t reach the lender to speak with live or worse, never receive a call back – brighly colored red flag!

    The other document I want to see filled out in full and signed by the Buyer is the BFI, where are they getting the funds for downpayment and closing costs. When agents balk at providing this, this is very bad sign to me. Buyers only need to disclose the funds they have to cover the DP and CC.

  14. Matthew Rathbun

    November 15, 2009 at 8:44 pm

    I’ve rarely taken the lender letter very seriously. They vary too much and have no course and effect. The lender’s are liable to the statements made in the letter.

    Lots of agents get irritated that REO’s want lender letters from their own institution. This makes perfect sense to me. The Lending industry has mastered the art of non-binding letters, so why would they trust someone elses?

    I agree that the Fannie/Freddie are the best of all the options. You need to be careful when you say “I’m not accepting anything less…” It’s our obligations to present everything to the Seller. I may give them sources showing that it’s not a dependable letter, but ultimately it’s still their decision to accept of deny it.

  15. Ashley Lambert

    November 15, 2009 at 11:33 pm Interesting

  16. BarryLynnMiller

    November 17, 2009 at 11:43 am

    I spent 12 years as a mortgage broker so therefore I have an advantage somewhat. Depends on who gives me the approval letter and if I don’t know the lender I always ask to talk to them and within 5 min I typically can size up the loan officer to determine if the approval is solid or not. At the end of the day I would suggest that if you as a Real Estate agent don’t understand the mortgage process to take some classes about mortgages it will only help your business.

  17. Joe Loomer

    November 18, 2009 at 7:46 am

    What Ted said – neither one of those two seem to be able to close their own front door on time (if at all). At least not in our neck of the woods.

    Navy Chief, Navy Pride

Leave a Reply

Your email address will not be published. Required fields are marked *


American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.



Housing News

CFPB was created by the Obama administration in 2011 to protect consumers, and immediately sought out ways to "bubble-proof" America, starting with mortgage disclosure...

Housing News

Accounting for the Veteran's Day holiday, mortgage applications actually fell for the week, but there is a silver lining when it comes to purchase...

Housing News

As the government has been shut down, mortgage application fell and uncertainty continues.

Housing News

The volume of people applying for any type of mortgage continues to fall as interest rates increase and other market changes take place.

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.