Locking an interest rate!

[stic2it]

I am buying a house, I already had the offer approved, and some other ins and outs done. I wanted to wait a couple more days to lock my rate because the rates were steadily dropping. I was told that to start filling out the paperwork for the mortgage, I had to lock my rate at that time. I could not wait any longer because I would have possibly missed my closing date. I was wondering if I could negotiate to the lower rate, my credit is almost perfect and I could easily qualify for the loan at a different bank but my bank is offering the lowest rates that I could find. I bought down my rate or would pay extra at closing, but I would save approximately 1k at closing and $20 a month on my payment. I was told that I needed to threaten to go else where for the loan and they may negotiate a lower rate. Has anyone successfully negotiated a lower rate after locking, and how did you go about doing it?


thnx

 

[haguc]

I had the same sort of situation happen to me about a year ago when I was refinancing. Depending on the institution they may have a clause that will allow you to move to the lower rate if it is more than a certain amount (quarter or half point normally). My bank had the same thing, but it was half a point and the rate had only dropped a quarter. I ended up just doing it at the rate I locked in at just because I didn't want to have bother with all the extra paperwork somewhere else. In my situation as well, I had to put down a deposit with them since they had to do an appraisal and such and if I would have switched to a different bank I would have lost the deposit. Your best bet is probably just to ask about getting the rate lowered, if you have banked with them for a while they may help you out, otherwise it can't hurt letting them know that you want to go somewhere else.

Good luck!

 

[grateful1]

haguc got it right....depends on the institution.

My credit Union allowed for a drop if one occured, for $250.

 

[pembroke3355]

I have been out of the business for a year now. When a rate is locked it is locked(As Gary say there may be some places that will for a fee but mot many). What is really ugly if you do a 30 day lock you will get a lower rate than if you locked it for 45 or 60 days. The problems starts when the lender your dealing with starts to demand a bunch of conditions they want sent to them. It can take time to do so and then they may require even futher conditions. If you do not close the loan in 30 days your fugged. Some lenders will extend a lock but charge a nice fee. Some will not do that at all. If lock expires if your lucky the rates will be lower than when you locked so you would still get the lock rate you had. If the rates are higher you will be paying the new rate.