Hawaii Randy's Real Estate Opinions: Advantages of Using Local Funding Lenders When Buying a Home

Advantages of Using Local Funding Lenders When Buying a Home

I have promoted the idea of using a local funding lender with my real estate clients for years and have saved my clients a lot of stress, time and money. 

Mortgage Pre-approval LetterWe hear so many stories of bad experiences from other real estate agents and members of the public that my clients are simply not running into.  Here are some of the issues they are running into when using brokers or out of state lenders.

  • Brokers do not loan money. Their pre-approval letters do not have the same weight as a letter from the actual lender.  Over the years we have seen so many bad pre-approval letters from brokers that we recommend our sellers not accept them at all and require the buyer get a letter from the lender that will be funding the money.
  •  Out of state lenders do not know our market, our contracts, our laws or our customs and time-lines.  They are notorious for blowing time-lines and putting buyers in breach of contract.  Buyers are put under unnecessary amounts of stress and in too many cases lose the home and some of their money.
  • Out of state lenders do not have the same vested interest in client satisfaction.  The local lenders depend on local real estate agents bringing their clients to them.
  • Out of state lenders can hide behind the phone.  You can go to the local loan officer’s office and look them in the eye.
  • The local lender is at the closing table explaining the mountain of documents you are signing, with the out of state folks you are on your own.


A couple more tips.  There is a difference between types of lenders. 

  • Loan officers at the mortgage lenders, have a license with federal background checks.  The loan officers at the banks or exempt.  Those who are unable to get a license work for the banks.
  • Loan officers at most mortgage companies are paid on commission.  No loan, no paycheck for them.  They have a vested interest in your success.  Most banks and credit unions have salaried staff handling the loans, they get paid the same on Friday whether you get the loan or not.
  • Most banks and credit unions are very conservative in their lending practices and have their own overlays that restrict who qualifies for a loan.
  • Many local banks and credit unions have a limited offering of loan products.  They may not offer the type of mortgage that is best for your needs.  Mortgages are not their primary business.
  • Mortgage companies in most cases have lower upfront fees than the banks.
  • Brokers add their fees on top of what the lender is charging.  They may claim they shop for lower rates, but will rarely match the price of the loan if you go direct.

Your experience in you local market may very, but speaking the Realtors and clients around the country my comments apply almost universally.

Super Realtor



Finding a great real estate agent is good first step. 

  They will be able to refer you to a great loan officer and lender.






Randy L. Prothero, REALTOR®

Broker-in-Charge, ABR, AHWD, CRB, CRS, e-PRO, GRI, MRP, SFR

eXp Realty

Team Leader - "The Prothero Group"

Randy Prothero is well established as an expert in working with military / VA clients and first time home buyers.  His home seller's (listing) campaign is one of the most aggressive marketing programs in the area.  His luxury home listings sell faster and for more money.

Based out of Mililani, Hawaii. Randy services the island of Oahu (Honolulu County) Performs mediations and ombudsman services for the Board of Realtors.  To improve overall professionalism in his area Randy also offers classes for real estate agents. 

www.HawaiiRandy.comOahu (Honolulu County) Property Search  Hawaii Military Relocations

Comment balloon 7 commentsRandy Prothero • August 11 2015 11:09AM


Fro me, local funding lenders don't let me down...I can not say the same about the intenet guys.

Posted by William Feela, Realtor, Whispering Pines Realty 651-674-5999 No. (WHISPERING PINES REALTY) about 4 years ago

Local lenders are the only way to go! I wish all buyers and agents would realize this. 

Posted by Ben DeHaven, Proudly serving Winter Haven & Lakeland, Florida (Haven Realty & Investments) about 4 years ago

I have been fortunate that most of my buyers have followed the wisdom and had great success. I have seen many other agents and their clients have terrible experiences.

Posted by Randy Prothero, Hawaii REALTOR, (808) 384-5645 (eXp Realty) about 4 years ago

 You are right on....Glad to see you are still around.....It's been a while.....Check out my new revised site New Orleans Condos and New Orleans Home Search. Had to get back to working it. Thankful for over 200 sales from the internet... 

Posted by Eric Bouler, Listening to your Needs ( Gardner Realtors, Licensed in La.) about 4 years ago

Eric - Your condo sites are definitely the best.  With all the small condo projects in your area, a buyer needs your expertise.

Posted by Randy Prothero, Hawaii REALTOR, (808) 384-5645 (eXp Realty) about 4 years ago

Randy, I agree we should use local business as often as possible.  I have also found that local business people want my business as much as I need their business.  Seems to be a 'no brainer'!

Posted by Anna Hatridge, Missouri Realtor with Goodson Realty (Goodson Realty) almost 4 years ago

Randy, I forgot to tell you THANK YOU for following my blog.  Really appreciate you.

Posted by Anna Hatridge, Missouri Realtor with Goodson Realty (Goodson Realty) almost 4 years ago

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