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Borrowers Need To Beware Of Zillow's New Mortgage Pre-Approval Tool

 

George brings to our attention the fact it is BUYER BEWARE when utilizing ZILLOW'S MORTGAGE PRE-APPROVAL TOOL.  I hope you check out this post, heed the warning and stay away from Zillow!

If you are looking for a knowledgeable Lender in the Albuquerque or Rio Rancho NM areas give me REALTOR® John McCormack a call 505.980.4576 or John@AlbuquerqueHomes.com.  I will gladly give you contact information on great area Lenders that will take care of your needs.

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www.AlbuquerqueHomes.com

John McCormack, Owner, Qualifying Broker, ePRO, REALTOR®

505.980.4576

John@AlbuquerqueHomes.com

Borrowers Need To Beware Of Zillow's New Mortgage Pre-Approval Tool.  Zillow just launched its new Mortgage Pre-Approval Tool which according to Zillow "allows home shoppers to get pre-approved for a mortgage quickly and easily".  Sounds good right?  Well like most anything else, a consumer, in this case Borrowers need to dig a little deeper.

What Zillow appears to be offering is a central location to collect the initial information for a Borrower to be Pre-Approved for a mortgage.  Zillow will then pass their information to affiliated Lenders who will Pre-Approve the Borrower.

According to Paul Hagey of Iman News:

"The tool, available on both Web and mobile, prompts homebuyers to complete a short questionnaire about their income, credit score and monthly debt that gives them an estimated preapproval loan amount.

If they’re interested in continuing the process after seeing that estimate, users enter in their name, email address and phone number, which makes their loan inquiry immediately available to lenders in the Zillow Mortgage Marketplace. Lenders can then pull potential borrowers’ credit scores and, if they meet the lenders’ standards, send them a preapproval letter that they can print or email."

What is NOT known is how many affiliated Lenders Zillow is going to pass the Borrowers PERSONAL information to.  Will two, three, or twenty Lenders be viewing the Borrowers PERSONAL information and pulling their credit?  Even though the Borrower will only be hit for one credit pull if all the Lenders pull their credit withing 14 days of each other, do they really want their PERSONAL information floating around in that many hands, by that many people they do not know?  In these days of identity theft this is a very risking position to put themselves in.

Furthermore,  how familiar are these Lenders with programs specific to each state, like Subsidized State Bonded Programs for First Time Buyers.  Also there is a WHOLE lot more to Pre-Approving a Borrower than just pulling their credit and having them state their income.

This seems to me like a receipt for major problems.  Borrowers could be opening themselves up tto Predatory Lenders, putting themselves at risk of identity theft, and receiving Pre-Approval Letters not worth the paper they are printed on

Zillow seems to be trying to test dangerous waters, which resemble the practices that played a role in getting us into the mess of the last decade.  Borrowers Need To Beware Of Zillow's New Mortgage Pre-Approval Tool, and the risks they are opening themselves up to.

 

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 Info about the author:

George Souto NMLS# 65149 is a Loan Originator who can assist you with all your #FHA, #CHFA, and #Conventional #mortgage needs in Connecticut. George resides in Middlesex County which includes #Middletown, #Middlefield, #Durham, #Cromwell, #Portland, #Higganum, #Haddam, #East Haddam, #Moodus, #Chester, #Deep River, and #Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com

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John McCormack    Owner/Managing Broker,  e-PRO

505-980-4576 / John@AlbuquerqueHomes.com

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Comment balloon 4 commentsJohn McCormack • March 31 2014 09:07AM
Borrowers Need To Beware Of Zillow's New Mortgage Pre-Approval Tool
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George brings to our attention the fact it is BUYER BEWARE when utilizing ZILLOW'S MORTGAGE PRE-APPROVAL TOOL. I hope you check out this post, heed the warning and stay away from Zillow! If you are looking for a knowledgeable Lender… more