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We are in the process of finalizing purchase of our first home... Everything went well until last ten days before closing date. Mortgage broker stated that he can easily lock us in 3.375% interest rate. And that's one of the reasons why we decided to buy the house. We anticipated some inflation of the rate in the 8-9 weeks period. Our target was 3.5xx% max. Their company policy is to lock the rate after appraisal. Appraisal was done on May 9th at which time the rate was 3.42% We urged them to lock the rate and his answer was "no worries everything is under control..." and did nothing. Couple days ago he told us that max rate will be 3.6xx% and final lock in rate on the contract was 3.875% and he claims to be so kindly giving us.
I know many will say that rate is low already but those fractions of points cost us additional $40,000 over course of the mortgage. Realistically It's not our fault...We urged him to take an action and he clearly failed. We put a huge chunk of money down so walking away is very hard. We are clueless... Can we do anything about this and ask them to honor the rate from the day when appraisal was done?
There's not much you can do if you aren't locked in. We've actually seen the most significant rate increase in the past 10 days than in any prior 3 or 4 years. The Feds have signaled they are done. With that kind of news, rates are only expected to increase further. Do most lenders require the results of an appraisal before you can lock in? No. I suggest you read your paperwork to see if you were advised of this policy. Chances are you just signed a form stating you knew your were floating and subject to market conditions.
Not what you want to hear, but I don't think there's much you can do. I have several buyers that got caught in the upward trend.
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