Fiduciary Friday
August 21, 2026 | 4 min read
A strong pre-approval tells you the buyer may be ready to purchase a home. It does not automatically tell you whether the financing is ready for this home, at this price, with these contract terms.
That is why a five-minute conversation with the lender before submitting an offer can be so valuable.
The goal is not to slow the offer down. It is to catch issues while the terms can still be structured intentionally—rather than discovering them after ratification, when every change becomes more complicated.
TL;DR
Copy and paste these five questions before your buyer writes:
☐ Has the lender reviewed this specific property type?
☐ What payment and cash-to-close should the buyer expect at this price?
☐ Would a seller credit materially improve the buyer’s position?
☐ Have taxes, insurance, HOA dues, and assessments been considered?
☐ Could any contract term create a financing or appraisal problem?
Before your buyer signs, take a closer look at each question.
A buyer can be well-qualified while the property itself still presents a financing question.
Is it a condominium, manufactured home, multi-unit property, mixed-use property, or home with an accessory dwelling unit? Is it subject to an HOA or located in a project that may require additional review?
Each can carry different eligibility, appraisal, insurance, or documentation requirements.
Condominiums are an especially timely example. Depending on the loan and project, the lender may need to evaluate not only the unit but also the condominium project, its insurance, financial condition, and other eligibility factors. Fannie Mae outlines several possible project-review paths here.
The question is not simply, “Can this buyer get a conventional loan?” It is, “Does the proposed loan work for this particular property?”
The list price may be within the buyer’s pre-approval range, but that does not necessarily mean the resulting payment or cash requirement matches the buyer’s plan.
Before writing, ask the lender to update the scenario using the proposed price and the best property-specific information currently available.
That estimate should consider:
The CFPB notes that the total monthly home payment may include far more than principal and interest, including taxes, insurance, mortgage insurance, and association fees. Some of those expenses can also change over time. Learn more from the CFPB.
The lender may not be able to provide a final figure before the contract and supporting documents are available. However, a current, property-specific estimate is far more useful than relying on the original pre-approval scenario.
A seller credit is valuable only when it has a useful—and allowable—job.
Depending on the transaction, a credit might help the buyer:
But the lender should first confirm how much credit the buyer can use and how it may be applied. Contribution limits depend on factors such as the loan program, occupancy, and loan-to-value ratio. Credits also generally cannot exceed the buyer’s eligible costs simply because a larger amount was negotiated.
Fannie Mae, for example, applies maximum financing-concession limits to interested-party contributions. An amount exceeding the permitted limit may be treated as a sales concession. See Fannie Mae’s example.
Before asking for a round number, decide what the credit is intended to accomplish.
Property-specific expenses can materially change both the monthly payment and the buyer’s qualification.
A home with higher taxes, expensive insurance, flood coverage, HOA dues, or a pending special assessment may not fit the same way as another home at the identical purchase price.
Pay particular attention to:
HOA and condominium dues are especially easy for buyers to mentally combine with the mortgage payment, even though they are commonly paid separately. The CFPB recommends factoring those dues into the affordability calculation from the beginning. Read the CFPB guidance.
The price is not the only contract term the financing team needs to understand.
Before submission, consider whether the offer includes:
These terms do not automatically make an offer unworkable. They simply need to be identified early.
Appraisers must analyze relevant sales and financing concessions, and a property’s market value cannot include value assigned to furniture or other personal property. Review Freddie Mac’s appraisal guidance.
A quick lender review can identify the financing implications. The Realtor and appropriate settlement or legal professionals can then address the contract language itself.
After ratification is the wrong time to discover that the project needs an extended review, the buyer cannot use the full seller credit, the HOA payment changes qualification, or the appraisal-gap commitment exceeds available funds.
A short pre-offer conversation keeps the Realtor, lender, and buyer working from the same numbers and the same priorities. It does not make every offer risk-free. It does make the offer more informed.
Realtor takeaway: Before asking only, “How much should we offer?” confirm that the property, payment, cash requirement, concessions, and contract terms all work together.
Use the Five-Minute Pre-Offer Checklist →