May 3, 2020 at 9:36 pm #67578
Hi everyone, my agent has heard that other agents will tell their sellers not to accept a NACA offer. How will they know it is a NACA offer? Is that ethical or legal?? Thank you!May 3, 2020 at 10:37 pm #67581
Not sure my response went through.
They will know because of how the process works.
It is legal but unethical and potentially bordering on housing discrimination laws depending on how the offer is declined.
But your agent should not only advocate for you but advertise your naca membership and offer advice and guidance to the seller on the process. No matter how much you like your agent if they don’t do both they are more concerned about comission. Hiding your status is not advocating for you and is actually unethical because the seller will find out anyway. It’s sneaky and works against you in the long run.May 4, 2020 at 9:03 am #67583
How is their commission effected with NACA?May 4, 2020 at 9:30 am #67586
It is not. They get the same commission regardless.
Naca actually has nothing to do with that. The agreement between bank of america and naca is that bank of america pays all closing costs. It’s the seller that typically pays the agent’s commission which comes from the sale of the house. And if for some reason it lumped into the closing cost fees bank of america pays it 100%.
Closing costs are not a set value. They are a series of fees including the appraisal, the county fees for providing the zone, writing the deed, paying the closing attorney or title company for drafting the settlement paperwork, etc. These are normally paid for by you. Typically you can expect 5-10% of the cost of the home on top of the down payment (that I think cannot be rolled into the loan either). This is one of the biggest reasons it is hard to buy a house. Even if you have the 3.5% down payment to buy through FHA do you also have the 5% closing costs?
With naca it is possible to buy with zero money out of pocket (excluding the home inspection) and your agent still gets 100% of their entitled commission. AND the seller gets a break too because their are fees associated with selling a house that do not apply with naca!
Any agent afraid of accepting a naca offer simply just doesn’t understand the process and the benefits. They see more paperwork (laziness), more time to close (greediness) and are afraid a cash or above asking price offer is right around the corner if the sale doesn’t close right now (again jonesing for that commission).May 4, 2020 at 9:39 am #67587
Thank you so much for your insight! Is there a place I can look up what kinds of breaks the seller might get if they choose to go with a NACA offer? I’m educating myself and also my VERY hesitant agent. I know I will have to do the majority of the leg work because she is so hesitant and negative. I’m also going to email the Real Estate Department to see if I can get a list of NACA trained agents in my area!May 4, 2020 at 10:18 am #67588purdynerdyParticipant
My recommendation is to get a good in house agent. I have one and she did a great job advocating for NACA and helped win us the offer.
You don’t want an agent who is negative Ave and hesitant about NACA.May 4, 2020 at 10:22 am #67589GoaldiggerMember
@Nelsont can you clarify your above post. Although the seller normally pays the agent’s commission does that mean that the commission that is usually paid to the agents by the sellers are covered by NACA (or BOA rather)? If so, I think that is a selling point in itself.May 4, 2020 at 11:47 am #67593
I would say the biggest selling point is that virtually no naca member is denied a loan through bank of america (it takes a loss of income essentially). A qualification with naca is teh same as a full on approval. A pre approval is running your cerdit and chaecking your paystubs without the full underweriting process. It’s the reason naca qualification often takes months and one of the biggest 3 reasons home sales fall through – contract is accepted but loan denied. This does not happen with naca.
And from @ttrumble 2/15/18: “Sellers/builders are under no obligation to pay anything toward closing, buydown, etc.
Under the NACA program, actual closing costs are paid by the bank. Not rolled into the loan or hidden somewhere else. The bank pays the closing costs, period.
Any funds contributed by the builder toward “closing costs” will be applied toward interest rate buy down”
This includes seller’s agent fees and attorney fees if any.May 4, 2020 at 11:59 am #67595GoaldiggerMember
Thank you for the information!May 4, 2020 at 1:38 pm #67602TTrumbleMember
Any seller’s agent who would discourage accepting an offer from a NACA member is definitely more concerned about how soon they can get their commission check, and has nobody else’s interests in mind, including their own client.
The fact of the matter is that that NACA approval letter is a far better guarantee of mortgage financing for the buyer than any pre-approval letter from a bank since your file has already been reviewed and approved by an underwriter, while the normal bank letter is just the loan officer’s “guesstimate” at how much they can afford. The NACA letter says “this is how much we KNOW they can afford” while the bank letter is nothing more than “this is how much we are ESTIMATING they MIGHT be able to afford”.
It may take longer to close on the home with the NACA loan, especially on the bank’s end, because of the full document underwriting process involved (and the huge number of NACA loans BOA is handling at any give time), but it’s a 99.9% probability of the loan getting the Clear to Close. That’s why anyone who advises against accepting a buyer with a NACA loan is just in a hurry to score a commission. They’re actually turning away a virtually guaranteed mortgage loan just because it might take longer to close.
Unfortunately, there is nothing illegal about rejecting an offer because of the financing source. You are absolutely right that it would seem to be discriminatory, especially since the lion’s share of NACA loans are to minorities. But unless there is actual proof that the rejection is actually based on a legally prohibited reason such as race, religion or national origin, they can get away with refusing claiming it’s because they don’t like the source of the financing. BTW, they will know it’s a NACA loan from the start because your qualification letter will bear the NACA logo.
All that being said, that’s why we instruct you to get a 60-day closing window in the Purchase and Sale Agreement, plus a clause stating that if the deal is cancelled because you don’t get the loan (i.e., the Clear to Close hasn’t been granted yet) you get your Earnest Money deposit refunded in full.
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firstname.lastname@example.orgMay 4, 2020 at 5:36 pm #67613kiagMember
Unfortunately NACA doesn’t have the best rep with realtors. I came across many of them telling potential home owners and other realtors to not work with them in forums when I first started the program. You can’t hide that you are working with NACA. It’s a great program but the delays turn some realtors off. Even in this forum you see a lot of complaints so from the outside looking in it can make you an undesirable buyer. It kinda is what it is.
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