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Are you saying you got a six-month Lock on a 30-year fixed in the 3%s?
No. We filled out the prequalification with the builder and they were giving us rates in the low 4's, but wouldn't lock us in at a rate until 60 days before closing. We had already been preapproved with a mortgage lender for an existing house we put an offer on with a rate in the mid 3's. We ended up pulling the offer and decided to go with a new build. We already knew we could do better than the builder's rate and we did. We got a rate of 2.65% plus a $500 rebate for signing up for autopay.
We started shopping rates about two months before closing.
I am doing a new build and we are almost there, another 45-60 days out from closing. It really wasn't about the rate at the time we signed our contract, not to me. It was about finding a lender that we liked and trusted. When you are 6 months out, the interest they tell you means nothing really, the rates change daily and the 3% they say now could be 5% by the time you get to locking, depending on what the market does. We still haven't locked yet. We should be doing that in a week or two.. our builder hasn't set a closing date yet but we know we are getting pretty close. Our builder does not have an in house mortgage company. They did have preferred lenders, and we did end up going with one of them after interviewing and talking to about 5 lenders.
We are buying a new construction too and the builder wants us to decide on the lender now and told us we can't have multiple lenders pending because they have to know "which one to send their closing documents to" and they will only send once. It's still 3 more months away from the estimated closing date and we cannot even get an accurate rate from the lenders at this point....
We are buying a new construction too and the builder wants us to decide on the lender now and told us we can't have multiple lenders pending because they have to know "which one to send their closing documents to" and they will only send once. It's still 3 more months away from the estimated closing date and we cannot even get an accurate rate from the lenders at this point....
This is horse hockey. I am an approved alternate lender for multiple builders, one national. The new laws have made it more difficult for the in-house lender to mislead a buyer, but they are obviously still doing so. Most lenders do not order the appraisal until the drywall is in.....about six weeks prior to close. That's around the same time most lock. So, until the appraisal is ordered there's no reason to be 100% certain. But if you are not concerned about two appraisal charges, keep your options open.
Closing documents do not need to go out anytime prior to 30 days before closing. How can these people keep a straight face with this garbage? Do check your contract. If it states builder to be told that far out, that trumps all else, but there is no need to "have to know" that far out. Push back, possibly consult an attorney to make certain there's nothing else with local laws we are missing, but what they are saying is silly.
They may need to send the closing attorney info on who the lender is, but you can tell them to order the title work with lender TBD and you will notify them when the lender is selected or your lender will notify the closing attorney.
This is horse hockey. I am an approved alternate lender for multiple builders, one national. The new laws have made it more difficult for the in-house lender to mislead a buyer, but they are obviously still doing so. Most lenders do not order the appraisal until the drywall is in.....about six weeks prior to close. That's around the same time most lock. So, until the appraisal is ordered there's no reason to be 100% certain. But if you are not concerned about two appraisal charges, keep your options open.
Closing documents do not need to go out anytime prior to 30 days before closing. How can these people keep a straight face with this garbage? Do check your contract. If it states builder to be told that far out, that trumps all else, but there is no need to "have to know" that far out. Push back, possibly consult an attorney to make certain there's nothing else with local laws we are missing, but what they are saying is silly.
They may need to send the closing attorney info on who the lender is, but you can tell them to order the title work with lender TBD and you will notify them when the lender is selected or your lender will notify the closing attorney.
"Horse Hockey?"
Yes. Yes, it is indeed...
Builder is pushing their valued customer around for some reason.
After pre-approval, how much documentation should I be submitting if I am just waiting things out until near closing. For example the builder lender is now asking for:
-Intent to Proceed Form to be signed and returned.
-Signed IRS Form 4506-T, Request for Transcript of Tax Return, to be returned. IRS validated transcripts must be received prior to closing.
-Retirement and brokerage account statements with all pages, for the past two months. Online histories are acceptable if includes bank name, account holder, account number and a 60 day history.
-Homeowners insurance is required 3 weeks prior to closing. Once you have established your insurance and accepted the quote, please have your agent contact us so we may provide the loan information.
-Borrowers Authorization and Certification, signed and dated.
-Lender will order an appraisal on the property. The appraisal, if subject to completion of the property or repairs completed, will require completion prior to closing and a final inspection by the appraiser.
Am I correct in assuming that this is standard info needed for underwriting and will lead to approval? Is that the point when I can stop the process and wait?
6 weeks out from closing is an appropriate time frame for ordering the appraisal.
None of those forms obligate you to close with this company, but you are close to running out of time, unless you dual process (have another loan app going elsewhere).
Your only risk is an appraisal fee. In the end, if it costs you $450 more to save on $50 on a payment, it's a no brainer. I just ran across a huge MI difference between me and a builder's mortgage company - .25%! (Credit unions have lower MI rates). This is a huge obligation you are taking on. Treat it as such.
My new construction required a two part process. They did one about 6 weeks out so it could go to underwriting and I was cleared to close shortly after that. But the house was far from finished, so the appraiser had to go back a day or two before closing to verify the house had been completed before I got the final sign off from the lender.
They didn't do an updated report or adjust the value, even though things in my market were literally going up 1% per month at that point so it probably had gone up. The appraisal was already 7.5% above the purchase price for the contract I had signed 5 months before, so it didn't really matter.
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