Buying a new house

User Forum Topic
Submitted by moneymaker on May 1, 2015 - 1:52pm

This was my response when inquiring about new housing "Thank you for your interest in our new home community. We are selling homes about 5 months before they're built! We go to our Priority List first and then we sell out of the latest Phase release within a week. You can get on our Priority List by getting pre-approved by CMG Financial. I have attached their contact information. Approvals from outside lenders will not get you on the list." I guess one doesn't have to finance with CMG but seems a little strict.

Submitted by HLS on May 1, 2015 - 2:03pm.

They cannot require you to use CMG to get a loan but they can require you to jump through hoops with them to get pre-approved and on their list

Submitted by njtosd on May 1, 2015 - 3:56pm.

Back in 2002, Pardee used to require you to register for a spot on their waiting list (at least for some developments) and to also put down a refundable $10,000 deposit to remain there. There were lots of people on the list . . . We eventually decided it was better to buy an existing home - it's hard to lock in a mortgage rate if the house isn't going to be finished for 6 months. Plus you saved yourself the cost of landscaping and all the other new home expenses.

Submitted by ltsdd on May 26, 2015 - 10:41pm.

moneymaker wrote:
This was my response when inquiring about new housing "Thank you for your interest in our new home community. We are selling homes about 5 months before they're built! We go to our Priority List first and then we sell out of the latest Phase release within a week. You can get on our Priority List by getting pre-approved by CMG Financial. I have attached their contact information. Approvals from outside lenders will not get you on the list." I guess one doesn't have to finance with CMG but seems a little strict.

This required pre-approval by CMG is more of a vetting process than anything. I don't think you're required/forced to obtain the loan through CMG if you get to the stage of obtaining the loan.

Submitted by SD Realtor on May 27, 2015 - 10:35am.

I have never seen a case where you MUST use the developer for financing.

That seems like it would have lawsuit city written all over it. Take my statement with a grain of salt but that would be interesting to see. I would heartily agree with HLS.

Submitted by HLS on May 27, 2015 - 11:02am.

The law is 100% clear.
Per RESPA there is absolutely no way that they can require you to only use their lender.
This is black & white. It would be considered 'steering' which is illegal.

Requiring you to qualify with their lender may be illegal as well, but it's a gray area.

Submitted by plm on May 27, 2015 - 11:13am.

They don't force you to use their lender but if you want their incentives, you have to use their lender. So you use their lender then refinance afterwards.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.