My broker just locked the 5/1 ARM rate for me yesterday. And today the rate has gone down sharply. Am I stuck? Or I can cancel and re-lock a new rate? My closing date is set to be end of this month and I haven't signed any loan documents yet. Please help!
2007-12-11 11:50:05 · 2 answers · asked by hollycoq 1 in Business & Finance ➔ Renting & Real Estate
I also would like to know if I re-lock to a different kind of loan (30 year fixed). I'm dealing with the builder's mortgage company, are they loan brokers or lenders?
2007-12-11 12:06:45 · update #1
I always like to answer this question with a question.
You just locked yesterday and today the rates went up, is your lender stuck or can he re-lock?
A lock is a contract between you and the lender and if written correctly the lender could sue if you have an approved loan and don't close with him on the terms of the lock. Very few suits have taken place but with lenders struggling, I wouldn't be surprised to see more.
Rate stayed stable today; maybe an 1/8% drop at best.
2007-12-11 14:10:56 · answer #1 · answered by Anonymous · 0⤊ 1⤋
No you may not cancel the locked rate you have because the rate dropped. If you let the lock expire then there could be penalties which could cost you.
You should check with your mortgage professional and see if there are penalties or you are confined to the locked rate even if you allow the lock to expire.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-12-11 12:05:12 · answer #2 · answered by loanmasterone 7 · 0⤊ 0⤋