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If you are pushing out your closing that far, there is usually going to be a fee (upfront) to lock 90 or 120 or 180 days (not all lenders even allow it). The rate likely went up because the lock period is so much longer than previously quoted (you said you changed the closing date).
If it were up to me, I would probably wait until I was at least within 60 days of closing to lock it in.
Of course, if you are dependent on a certain rate to qualify, then it's better to bite the bullet and go ahead and lock now.
Good luck whatever you decide.
I wonder why she didnt mention a fee or even get into that discussion much?
She indicated that the rate changes more than once in a day sometimes and definitely daily. I thought what she was saying was that the rate she quoted us (the 5%) was presently higher now that things have gone through processing. So do you mean it changed because of something else other than "rates change daily" - and that it had something to do with our closing date? If so, how do they calculate a rate as it relates to your closing date?
I always thought that rates went according to your qualifying information particularly your credit, and that the better a risk you were, the better the rate you'd get? How does it work that qualification might depend on the rate you got? Please excuse my confusion, it eminates from me, I know..
Here is a site that shows today's wholesale mortgage rate. Actual lendors and brokers rates should be a tad higher than that. The rates will also be higher if you do not have perfect credit or want longer locks. I would also check the big banks websites on a daily basis (some you can even have set up a free rate watch to email you every day) like wachovia, bank of america, hsbc, etc.
This website says the current rate is at 4.851%, and bankrate says 5.20%. So would it be safe to say that 5.0-5.2% is a likely range of the rate we'd be able to lock in right now?
Is it possible to lock a rate 90 days out, or is 60 days the longest?
Interest rates change constantly, but it is important to know that rates are cyclical. If rates are currently at historical lows then we know there is a strong probability rates will go up again, and vice versa. Certain economic indicators such as unemployment data, consumer price index, retail sales data, and consumer confidence all have an effect on mortgage interest rates. But the key factor to watch is the relationship between stocks and bonds.
When the economy is slow and the stock market is "bearish," many investors move money out of stocks and into bonds and mortgage-backed securities. This causes mortgage interest rates to go down. When the economy is doing well, the stock market rallies and is considered "bullish." Investors then have a tendency to move their money out of that safe haven of bonds and mortgage-backed securities and back into stocks. As a result, mortgage interest rates go up. As of late seeing several rate changes within one day has been the norm so to answer your question either this broker is BS ing you or his rate is so high he is not worried about rate changes so he only changes them once a week.
Here are a couple of resources to back up what I am saying: How often do interest rates change? | Mortgage Reference Library
This is a product available to mortgage pros from Barry Habib the mortgage guru (seen on network channels like Fox business, CNBC, CNN etc..) you can google him if you like
In light of the unemployment rate increase, newly increasing taxes, lack of consumer confidence and poor retail sales, would it be safe to assume that bank rates will either stay low or decrease over the next few months? Or is it much more complicated than this and one never knows?
If our closing date is 11 months out, at what point are we able to lock something, about 3 weeks from now? I dont know why the l.o. didnt explain all of this to us in greater detail...
I still dont know how long we stay in this loan limbo. The appraisal has yet to be done - maybe that has something to do with it. Nothing is set in stone yet and we have alot of documents to sign as soon as someone does something that I have no clue what that something is...clear as mud
In light of the unemployment rate increase, newly increasing taxes, lack of consumer confidence and poor retail sales, would it be safe to assume that bank rates will either stay low or decrease over the next few months? Or is it much more complicated than this and one never knows?
If our closing date is 11 months out, at what point are we able to lock something, about 3 weeks from now? I dont know why the l.o. didnt explain all of this to us in greater detail...
I still dont know how long we stay in this loan limbo. The appraisal has yet to be done - maybe that has something to do with it. Nothing is set in stone yet and we have alot of documents to sign as soon as someone does something that I have no clue what that something is...clear as mud
JC,
You really need to clear all this up with your loan officer. With limited information regarding your transaction, it is really difficult for us to guess why there are changes in the rate quote from 5% at first to as high as 5.75% now. There could be a number of reasons including borrower specific reasons like credit scores, or transaction reasons (she was quoting a 30 day close before and is now quoting a 90 or 120 day lock, which will always be higher), or it could simply be a bait & switch...hard to say.
I would give her the benefit of the doubt, but it's her job to make sure you understand how everything works.
The short answer is you can't get banks rate sheets they are for employees or brokers only- if a broker copies or forwards them they could be cut off from that lender. I will personally show them to clients but they can't have a copy and the reality is there only good until the next one comes out- could be minutes or tomorrow morning.
The biggest problem I am hearing is it sounds like you don't trust you loan officer and want to be able to check on what you are being told. If you are not trusting their information you ned to cut ties now because you are spending alot of time and stress on something you shouldn't. A good loan officer will fully disclose to you what went into establishing your rate including but not limited to: base rate, adjustments due to loan to value, credit score, and what he/she is making for working on your loan.
The worse thing you can do for yourself is to choose a loan officer, lock a rate and then watch the news. I say this because just last month I had a client locked at 5.375% with no closing costs then he calls and tells me he saw a report on a website that said rates were now 5% and mine was now too high. He emails me the link and it is talking about averages not specifics. Right in the middle is a line he forgot-- average of .7 points. As soon as I pointed it out he realized his mistake by comparing his rate for a no closing cost loan and that which averages in full closing costs including origination and possibly even discount points from an ad or news story.
jctx--- you need a new loan officer.
Thanks Dad2Jules. Good information!
I had mentioned that the rate originally quoted to us was 5% and then it was different on the voicemail. What I meant was that when I call her office, her voice message that all her clients receive said 5.3-5.something which leads me to think that this cant be taking into account LTV, credit score, etc. I have no idea what rate range she is quoting...but the next time she calls me I'm going to ask (my calls from her are few and far between).
I'd hold off if at all possible. The rates are going to go down. Obama's really pushing the banks to lower the rates to borrowers (the banks are getting the money virtually free) .
I found an interesting piece on 6 unemployed families around the country: The unemployed
This is a cross section of what's going on out there right now. And how it will effect the housing market and the lenders.
That being said, if you call, your loan officer and they don't reply in a timely manner, then I'd say it was time to find a new one. They could be dragging their feet for another reason.
I have no idea what rate range she is quoting...but the next time she calls me I'm going to ask (my calls from her are few and far between).[/quote]
If you are not getting your calls returned you should run from this loan officer. There is no reason that any phone call should not be returned within 1 business day at the most.
Just refinanced at 5.375 with no closing costs. This is 30 year fixed. I think the rates will go down so I will not buying down any points. I think buying down points is the worst thing you can do.
Well there are certain circumstances but most of the time, not paying for the closing is the best option, I think.
If your rate is higher than 5.5, I would refinance now.
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