Slide company in the Interest Rate Lock Agreement

Aug 6th, 2022
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How to slide company in the Interest Rate Lock Agreement

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[Music] hi my name is alex carlos with guston show associates i want to talk to you about this disclosure you guys get when we send you a package and i get calls on all time and youre asking what does this float mean when it comes to this interest rate disclosure so when we do an application we put a rate in there its about the going rate for your file but you know weeks weeks go on you know two weeks go past and then you get a contract and that may not be your rate but we still submit the loan with that old rate we had in there rates might be a quarter higher a quarter better so we dont discuss locking the loan necessarily until maybe the loans and underwriting some loan officers lock it before it even goes in so i usually wait because my loans take a little bit longer because im doing tougher loans so i refer to going underwriting and im 99 float so what float means when you get that disclosures that your loans not locked and youre aware that your rate can change so if you see

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Locking your interest rate means the rate will stay the same from the time of the rate lock until the rate lock expiration date, regardless of changing market conditions. Your final interest rate may be higher or lower than what was initially quoted to you if there are changes before your loan closes.
Once your application is approved, you will receive a commitment letter stating that the lender is willing to provide the specified loan amount, subject to certain conditions. The timeline for receiving the commitment letter can vary based on individual circumstances and the lenders process.
Also, keep in mind that the lender can void a rate lock if certain items on your credit report or mortgage application change between the time of your agreement and final underwriting.
Rate lock fees will vary based on the length of your rate lock period and interest rate chosen. We will refund the rate lock fee if your application is denied. If you withdraw your loan application or it is cancelled, the upfront extended rate lock fee may not be refunded unless the application is for a VA loan.
Most lenders measure this cost as a percentage of your loan amount (0.25% for example). What happens if you lock in a mortgage rate and rates go down? If interest rates go down after your rate lock, you are still committed to your initial, agreed-upon rate, unless your loan includes a float-down provision.
A mortgage rate lock ensures the rate on your mortgage stays the same, from the initial quote to closing. Locking in your rate isnt a binding contract to work with that lender, though. You can still switch lenders if you choose to.
A lock-in or rate lock on a mortgage loan means that your interest rate wont change between the offer and closing, as long as you close within the specified time frame and there are no changes to your application. Mortgage interest rates can change daily, sometimes hourly.
A mortgage rate lock is binding for both the lender and the borrower for the duration of the rate lock agreement. One of the only things that may impact a rates consistency is if there are changes to your loan application before closing.

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