Buying A House And Locking Interest Rates
by Home Buyer Locking At Five Percent
Regarding Buying A House And Locking Interest Rates: Recently we were buying a house. About a month ago, we met with our mortgage broker and had the opportunity to lock our interest rate at 4.875 percent by buying one point.
Our broker informed us that it was the position of her company to encourage people NOT to lock rates since they predicted rates would continue their downward slide. Considering our buyer had not yet received his commitment letter, we were afraid to lock and then have it fall through and have to pay a fee for not taking out a mortgage.
So, we waited. Our broker was constantly e-mailing us rates back and forth. They definitely didn't continue their downward slide.
At one point, we thought we'd have to get 5.5% and buy 2 points. We were not happy because it meant needing an extra $4000 at closing and our monthly payment was nearly $200 more.
The waiting paid off for us, however. We were fortunate enough to lock at 5% and buy 1 point.
This was the last day we had available to lock since we were closing just two days later. Now that we have just closed on our house, I don't plan on looking at interest rates any more. I don't want to know if they went any lower.
Kate Answers: Buying A House And Locking Interest Rates
Dear Home Buyer Locking at 5%, I can't say I heard of a company wide policy that encourages home buyers to NOT lock. I am glad in your case delaying your mortgage rate lock turned out okay although it sounds like you might of experienced a few weeks of volatile rates while buying the house.
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