How can a lender lock a rate and then not honor it?
I waited to lock the loan until I got the rate I wanted. Advised to do this by broker who was advised by the lender to wait. So we locked on Friday - about 3 weeks after submission. Got approval today... at half a point higher. The risk factor on my loan did NOT change from the time of submission. Would it not stand to reason that the lender would have said, "be sure to tell your client that, because of the high level of risk, the rate will be the locked rate PLUS a half point?"I have been extremely clear on what I was looking for in a rate and the broker KNEW this. Can someone explain this to me? by dmdill_419_818 from Monrovia, Maryland. Jun 7th 2012
William J Acres (William_Acres)
#74 ranked lender in Arizona - 8,728 contributions
I agree that your broker probably dropped the ball. Every lender out there posts their adjustments, and my guess is that he missed a few.. But I also agree with Bennett... with an EA 3, and underwater, it's a blessing that you're getting an approval at all. You could roll the dice and try with another broker, but the results would be the same, and you would be exposed to potential rate increases while your being underwritten.. I would just take the deal and caulk it up to experience... Had you asked more questions or asked for something in writing from your broker, stating that once you "Locked", your rate wouldn't go up.. Then maybe he would feel obligated to continue with the loan even though he miss quoted it, but it's anyone's guess now.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com
Ken Burrows (mortgagesforamerica)
#19 ranked lender in Nevada - 572 contributions
It sounds like to me that your broker didn't factor in the rate hits when quoting you. Every lender has certain rate hits based on LTV, Loan Amount, State, etc... It sounds like your broker dropped the ball a little. If you would like help get into touch with me, the rates are very good today. 888-320-7888 - www.MortgageWholesale.net - Ken
Tony Sergi (tsergi)
#48 ranked lender in Maryland - 11 contributions
Did they disclose the locked interest rate to you with a revised GFE? If they did a major characteristic of the loan would have had to change for the rate to change as well. in the end it sounds like the broker dropped the ball on quoting an accurate rate furthermore three weeks to get an approval is a long time. Feel free to call for a second opinion. We are a local Maryland Bank and all of our processing and underwriting is done in house.Tony Sergi410-878-29051st Mariner MortgageNMLS# 369734
It's a HARP LOAN. Pre-approval - EA3 Anyone missing the risk factor here? I'm just so mad. If I'd wanted 4.75% I could have gotten that four months ago with our current lender. So there is no recourse here. I jump ship or I take the rate. But great news... 30 fixed rates are at an all time low of 3.87% - just got the email notification!!! I just wish there was ANYTHING that I feel is FAIR about this. These programs are for people who are upside down on their mortgage and need help. They're all in it to line their pockets. Unbelievable to me. Just unbelievable.
This process started more than THREE MONTHS ago with the "HARP loan with $10k to close" from our current lender. Rate was 4.75%. They already had our loan. So they drop my rate .5%, charge me a POINT to do so, roll in costs - with exorbitant fees for a loan they already had in house - left us bringing $5k to the table and rolling in another $5k. So they'd keep the loan - pay off the old one and make nine points on the other side after charging me A POINT to get that rate. Yes - we DID walk away from that. I was quoted 4.25% by the broker I found on this site who is currently doing my loan. Then ICON backed out and she couldn't give me the 4.25% rate anymore, so I kept shopping. After another broker I found here (bait and switch) I went back to work with original broker from this site. She got the automated EA3 pre-approval prior to full doc submission, and upon advice from the lender, told me not to lock. Nothing about the EA3 requiring an add-on percentage because the loan is high risk. BY THE VERY NATURE OF THE PROGRAM THE LOAN IS HIGH RISK. To presume that the rate you were quoted - and locked at - was an actual rate doesn't seem like too much to ask.lbennett - "You sound like so many other borrowers out there, you want everything, but willing to give nothing." - You have absolutely no idea how this situation occurred. How dare you judge me because I would like to be treated fairly. Thank you all for your opinions.
Former National Director of Sales for mortgage powerhouse. I told her my saga to which she replied, "You want to hear something that will make you sick? They are being paid 9 points on the other side to charge you one point and keep the loan in house."In the business for more than 30 years. The fun part for me in this instance is that you're kind of being a JERK to me on a site where - let's face it ... You're fishing for clients. That will help people weed you out early.
William J Acres (William_Acres)
#74 ranked lender in Arizona - 8,728 contributions
OK... so now we have more of the story.. ICON Residential Mortgage did come out April 11th and put a freeze on all HARP 2.0 loans over 150% LTV.. So even if you were submitted, through underwriting and rate was locked, If your loan wasn't in "Approved" status, you were subject to the new guidelines.. If you were approved, you would have had to close before your original lock expired, and they would not extend the lock under any circumstances.. They also increased their rates and overnight.. So, your lender probably had to find someone else out there accepting EA3's.. And there's only one other out there that I'm aware of, and their pricing is terrible, and it will take 3 months to close (CMG Financial). There is no lender out there making 9 points on a HARP loan... period!! And whoever is telling you that is way out of touch with the current lending rules.. Lenders rate sheets barely go to 5 points and then the adjustments start picking away at that.. EA3 is a hit, High LTV is a hit, Lower than 740 credit score is a hit.. etc, etc, etc... by the time you're done, you're lucky to be making 2 points total, and no loan officer is stupid enough to even try to make 5 points in this market.. if the borrower get's one other quote, he's done and out.. so he must be competitive.. It's unfortunate your deal didn't go through as you thought.. But now I'm not sure your loan officer was to blame.. Your file is at the worst level before a denial..and as I stated earlier, it's a blessing you can get refinance at all.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com
Todd Tholl (toddtholl@leader1.com)
#4 ranked lender in Iowa - 239 contributions
Either LO dropped the ball and quoted you an incorrect rate or program rules changed midstream before your approval & lock
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