House Closing Date changed after commitment letter expiration date (loan officer, approved, rate lock)

[JesusJosephUS]

Hi All,
I am in process of buying a home in NJ. The planned closing date was Nov 15 and my rate lock is till Nov 13. Not I need to hold the rate by paying 780$ for every 15 days.

As this is a oil tank issue and they need to remove it the closing date could be first week of January. So If I want to hold this lock then I need to pay 3120$ (780$ x 4) if the closing date is before Jan 13, which I can give but the Jan first week is also not yet confirmed. So I can't keep on extending.

Today morning my attorney told me to cancel the commitment letter (or withdraw the commitment letter), which anyway expires on Nov 27 and start the loan process again. I don't have any problem in it and I need to provide all the documents again as they are going to use the same appraisal.

When I talk to my loan officer he told me that I will be out of contract if I cancel the loan and also he told that the loan is already approved its difficult to get it approve again. The loan officer told that he is going to talk to my attorney regarding this.

Can you please tell me what you will be do in this situation.
I am really confused and also not sure what to do next on this.

any advice will be appreciated.

Thanks
Joseph

[VictorBurek]

You are getting information from your loan officer. Having your loan approved now doesn't make it more difficult to approve again.

[JesusJosephUS]

Originally Posted by VictorBurek

You are getting information from your loan officer. Having your loan approved now doesn't make it more difficult to approve again.

thanks for your info.

[399083453]

Originally Posted by JesusJosephUS

he told that the loan is already approved its difficult to get it approve again.

Do the math. Is it cheaper to hold the rate, or tell the loan officer if he can't do it, you will have to go with another bank. You don't have to use his bank. The deal is already delayed because of the oil tank issue, this can buy you plenty of time to get a new lender. Oil tank issues can take awhile to remediate if the tank was leaking , old dirt needs to be removed and new dirt needs to be brought in. It could take longer than you think.

[JesusJosephUS]

Originally Posted by 399083453

Do the math. Is it cheaper to hold the rate, or tell the loan officer if he can't do it, you will have to go with another bank. You don't have to use his bank. The deal is already delayed because of the oil tank issue, this can buy you plenty of time to get a new lender. Oil tank issues can take awhile to remediate if the tank was leaking , old dirt needs to be removed and new dirt needs to be brought in. It could take longer than you think.

Thanks for your comments. Yes it may take a long time. That is what my attorney told me to cancel and start again because we don't know when the closing.

I don't want to change the bank because the loan officer (all time return to my calls) is good and he did lot of work for me.
I will talk to him soon and i will reapply the same loan.

Thanks
Joseph

[JesusJosephUS]

Originally Posted by 399083453

Do the math. Is it cheaper to hold the rate, or tell the loan officer if he can't do it, you will have to go with another bank. You don't have to use his bank. The deal is already delayed because of the oil tank issue, this can buy you plenty of time to get a new lender. Oil tank issues can take awhile to remediate if the tank was leaking , old dirt needs to be removed and new dirt needs to be brought in. It could take longer than you think.

Regarding the math, as of now its same rate as i lock my rate. I lock my rate at 4.5 and its still 4.5 or may be 4.625. So canceling and re applying the loan is the good option.

[SmartMoney]

Originally Posted by JesusJosephUS

Regarding the math, as of now its same rate as i lock my rate. I lock my rate at 4.5 and its still 4.5 or may be 4.625. So canceling and re applying the loan is the good option.

The problem is, you can't just cancel for rate lock reasons. Otherwise, the entire world would cancel and reapply for lower rates. This is why most banks went to a worse case scenario.......meaning original rate or current rate, whichever is higher (or additional $ to extend). That lender went out and secured a commitment based on your lock. They won't let you cancel and reapply, unless you wait 60 days from the date of cancellation to the date of re-application.

You can try to write an email to your loan officer explaining your attorney's advice and tell him that unless they can allow you to cancel and reapply, you may have to go to another bank to follow your attorney's advice. (Write the email in a stand alone format - not a reply or forward - so your loan officer can forward that email to his/her management). The problem is your attorney doesn't understand the lock process and restrictions. If your lender understands your dilemma, they may make an exception..........but then they risk violating Fair Housing regulations if they don't offer the same options to other buyers. See the problem?

You may need to, through no fault of yours or your loan officer's, may need to actually go to another lender and put the first lender in a position where they have to do a price match, an acceptable reason to offer you a lower rate outside of guidelines.

[JesusJosephUS]

thanks for all your comments

Now I am going to extend the rate and me and the seller split the extending cost.