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Old 09-07-2008, 09:01 PM
 
1 posts, read 9,454 times
Reputation: 11

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About two weeks ago I locked in a $258K VA loan for 6.5%. With the current govt takeover of freddie mac and fannie mae interest rates are expected to drop to nearly 5.5% over the next couple days, they are currently around 6%-6.125%. If the rates go as low as 5.5% thats a savings of $60K over the life of the loan and 6% represents just over $30K over the life of the loan.

Is there any way to cancel my previous locked in rate and get the lower rate with the same lender? I dont really want to go through the whole application process with another lender but is that the only way to save money?

Thanks-

Rich
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Old 09-07-2008, 11:50 PM
 
Location: Tennessee
84 posts, read 327,781 times
Reputation: 61
We are kind of in the same boat, but in our case, the mortgage lady told me over the phone that she had already locked it in at 6.25%, when I asked her, "do I need to lock in a rate?" Is it possible to tell her that we want something in writing, this time for the lower rate that it will be tomorrow? This would help us tremendously!!!!
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Old 09-08-2008, 03:05 AM
 
300 posts, read 811,790 times
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Quote:
Originally Posted by rthomas38a View Post
About two weeks ago I locked in a $258K VA loan for 6.5%. With the current govt takeover of freddie mac and fannie mae interest rates are expected to drop to nearly 5.5% over the next couple days, they are currently around 6%-6.125%. If the rates go as low as 5.5% thats a savings of $60K over the life of the loan and 6% represents just over $30K over the life of the loan.

Is there any way to cancel my previous locked in rate and get the lower rate with the same lender? I dont really want to go through the whole application process with another lender but is that the only way to save money?

Thanks-

Rich
No. You have to let the lock expire, or go through another lender. Locks work both ways, not simply against the lender.

BTW- You might want to be a little careful shopping for a lower rate. When rates get low, even in the past year, loan volume goes up and banks get behind processing the loans. A whole raft of loans from earlier this year when rates dipped below 5% briefly wound up getting reset into the 6%+ range because of this.

Quote:
Originally Posted by aamazing75 View Post
We are kind of in the same boat, but in our case, the mortgage lady told me over the phone that she had already locked it in at 6.25%, when I asked her, "do I need to lock in a rate?" Is it possible to tell her that we want something in writing, this time for the lower rate that it will be tomorrow? This would help us tremendously!!!!
Who is this mortgage lady? A broker, or the bank? I definitely wouldn't believe a broker in this case and would check directly with the bank. If you don't have anything in writing, I wouldn't consider your rate locked until you do. You should always get a rate, a loan amount, loan terms, and an expiry date on that rate, in writing, from the lender. Otherwise you're playing with fire because not all of the terms of the loan are set. You could wind up getting a lock on the wrong amount for a short period with unfavorable terms.
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Old 09-08-2008, 07:09 AM
 
739 posts, read 2,493,397 times
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My stupid lender called me late Saturday night and advised me to lock in the rate. I said Ok if you think thats best. Now today I'm super P.Oed.

Now I'm thinking of cancelling this mortgage lender.
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Old 09-08-2008, 08:19 AM
 
Location: Fort Myers, FL
1,286 posts, read 1,941,862 times
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while there are many options, if your with a broker they can shop it to a new bank. If you went to a retail bank branch your stuck. Even with that tho, what if you don't qualify with anyone else?

you should be lucky just to get a loan. personally i dont lock until a day or 2 before closing. rates adjust, they go up and down, thats what happens. apparently your banker is pretty slow, since fannie mae/freddie mac all took place friday, naturally they will fall this week, besides the fact that the economic reports due this week are supposed to drive rates down even further.
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Old 09-08-2008, 09:35 AM
 
Location: Tennessee
84 posts, read 327,781 times
Reputation: 61
Quote:
Originally Posted by obsidian97 View Post
No. You have to let the lock expire, or go through another lender. Locks work both ways, not simply against the lender.

BTW- You might want to be a little careful shopping for a lower rate. When rates get low, even in the past year, loan volume goes up and banks get behind processing the loans. A whole raft of loans from earlier this year when rates dipped below 5% briefly wound up getting reset into the 6%+ range because of this.



Who is this mortgage lady? A broker, or the bank? I definitely wouldn't believe a broker in this case and would check directly with the bank. If you don't have anything in writing, I wouldn't consider your rate locked until you do. You should always get a rate, a loan amount, loan terms, and an expiry date on that rate, in writing, from the lender. Otherwise you're playing with fire because not all of the terms of the loan are set. You could wind up getting a lock on the wrong amount for a short period with unfavorable terms.
She is a mortgage broker for Wells Fargo. Should I call her and tell her I want something in writing?
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Old 09-11-2008, 05:58 PM
 
3,687 posts, read 7,627,608 times
Reputation: 1631
Yes yes yes!
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Old 09-11-2008, 07:27 PM
 
Location: Plano, Texas
1,672 posts, read 4,444,098 times
Reputation: 642
Quote:
Originally Posted by obsidian97 View Post
No. You have to let the lock expire, or go through another lender. Locks work both ways, not simply against the lender.


BTW- You might want to be a little careful shopping for a lower rate. When rates get low, even in the past year, loan volume goes up and banks get behind processing the loans. A whole raft of loans from earlier this year when rates dipped below 5% briefly wound up getting reset into the 6%+ range because of this.


Who is this mortgage lady? A broker, or the bank? I definitely wouldn't believe a broker in this case and would check directly with the bank. If you don't have anything in writing, I wouldn't consider your rate locked until you do. You should always get a rate, a loan amount, loan terms, and an expiry date on that rate, in writing, from the lender. Otherwise you're playing with fire because not all of the terms of the loan are set. You could wind up getting a lock on the wrong amount for a short period with unfavorable terms.
This post does contain some bad information. The post states you have to let the rate expire or go to a different lender. You can definitely go to a new lender, which is one of the many benefits of working with a broker, but when you work with a bank you only have the one option. The bad information is you have to let the rate expire. If the rate expires, you cannot relock with the same lender at a better rate, you get what is called worst case pricing. Meaning if rates are better, you get the same rate that was already locked, if rates are worse, then you get the worse rate.

The second point about pulling your loan could delay your closing is a good one.


Not sure why this poster wouldnt believe a broker. It is sad when someone makes an assumption about an entire group of people.

Last edited by VictorBurek; 09-11-2008 at 07:29 PM.. Reason: moving things around
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