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Old 11-23-2008, 05:15 AM
 
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Hello, is a person allowed to walk away from a purchase contract within the 14 day inspection period? Do the 14 days start the day the offer is accepted? One more question, Wells Fargo's loan pricing disclosure states that even if you lock in your rate they could still increase it on your closing day due to the risk of your mortgage, is this a common practice used by other lenders as well? Thanks.
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Old 11-23-2008, 09:24 AM
 
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The 14 days generally starts when the offer is accepted. It depends on the wording of the contract as to how long you have to walk away and for what reason(s).

As far as the raising of interest rates, if you lock in and are approved, unless you do something stupid that clearly changes your financial situation (buying a new car with a significantly higher payment, running up $150K on credit cards, etc.) the rate won't be changed at closing. BUT the underwriter can counter-offer.

This would be to reject you based on the type/terms of the loan you applied for and instead offer you a different type of loan. For example you might have applied for a 15 year fixed, and the U/W might feel that your ratios are just too tight for this product, and instead offer approval for a 30 year fixed. This would nullify your locked-in rate for the 15 year fixed. This happens prior to coming to the closing table though. As long as you comply with the terms of the approval and comply with any conditions, there's no reason for a rate/term/loan type change to happen as a surprise.
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