Warren County Ohio Real Estate News and Observations: Do I Have To Use The Builder's Lender?

Do I Have To Use The Builder's Lender?

want to build here?Most major builders in the Cincinnati area are tied closely with a particular lender.  Given their choice they'd prefer you use THAT lender before any other you personally chose.

It's not unusual for the builders to even offer some type of incentive for you IF you use their designated lender.  Perhaps a bit of a discount on closing costs, or some credit towards options, or something else to sweeten the pot.

But something to keep in mind, the lenders aren't always unrelated to the builder.  In some cases the builder and lender are sister companies under the same overall corporate umbrella.

Now while the builder can't require you to use a particular builder, they CAN require you to get preapproved through their preferred lender.  It's their way of giving them the required level of comfort before proceeding with a major investment of materials and time on your behalf.  And if it makes sense for you to take advantage of their offer, then it's your choice to use the builder's preferred lender.

But we can't say every case of prequalification works out well for the buyers.  In some cases the builder is more stringent than other lenders, so you might get a thumbs down from the builder's lender while your own loan officer has verified they won't have trouble making your loan.  When that happens, chances are the builder won't want to proceed based on the word of your lender.  Been there, done that, and for our buyers it was better to let the builder cancel the contract and buy from a smaller builder who didn't have an affiliated lender providing a thumb's down to our buyer.

Bottom line, expect a builder to require you to get preapproved through their preferred lender, but it is ALWAYS your choice for which lender will actually loan you the balance of the purchase price.


Ready to talk getting your own home built?  We work with ALL major Cincinnati area home builder.  Call Bill of The Liz Spear Team of RE/MAX Elite at 513-520-5305 or email Liz@LizSpear.com.

Serving Cincinnati area home buyers and sellers,

Liz and Bill aka BLiz



Serving Warren County Ohio & Adjacent Areas

The Liz Spear Team of RE/MAX Elite
Elizabeth Spear, ABR, CRS, Ohio License SAL.2002007747

William (Bill) Spear, CRS, Ohio License SAL.2004011109  Kentucky 77938
Ask for us by name if you visit the office!

EHO Two locations: Lebanon & Mason, OH
Bill Direct:  513-520-5305
Liz Direct: 513-265-3004     
Fax: 866-302-8418

MailTo:  LizSpear@Go-Concepts.com

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Comment balloon 4 commentsLiz and Bill Spear • September 17 2017 02:37AM


There are builders in our area who will insist on a pre-qualification from their lenders, but they know they can't insist on the use of their lender. It really often depends on the incentives offered whether my buyers use a builder's lender or their own. The right thing to do is to shop first.

Posted by Nina Hollander, Your Charlotte/Waxhaw/Fort Mill Area Realtor (RE/MAX Executive | Charlotte, NC) about 1 month ago

Excellent advice for those seeking new construction homes directly from the builder.  I would strongly suggest looking at the terms of any loan being offered by the "in-house' lender.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) about 1 month ago

Hi BLiz- buyers need to be educated about all of their choices before they move forward!Have a great Sunday. 

Posted by Kathy Streib, Home Stager - Palm Beach County,FL -561-914-6224 (Room Service Home Staging) about 1 month ago

Hi Bill - When builders here offer incentives to use their lender, we always encourage our clients to compare the deal with a good local lender. It's sometimes very apparent that the offered incentive is paired with higher fees and rates.

Posted by Dick Greenberg, Northern Colorado Residential Real Estate (New Paradigm Partners LLC) about 1 month ago