Can Mortgage Brokers Lock in My Mortgage Rate

by Mary W from Chesapeake,VA

Ask Kate if mortgage brokers can lock in a mortgage rate: Can a mortgage broker lock in an interest rate? I didn't realize that I was dealing with a broker until I received preliminary papers to electronically sign. She stated that my rate has increased over a two day period. So I asked her if she could lock it in.



She stated that she would keep an eye on the rate until I close. I then asked her if she was a broker and she stated yes. But I am afraid that the interest rate could soar and then I wouldn't be able to refi at all.

She also told me to call all of my creditors and tell them to close my accounts.

Should I go with a direct lender? Am I liable for signing her preliminary papers? I am not educated with this process. Please I would appreciate your advice.

Kate Answers: Can Mortgage Brokers Lock in My Mortgage Rate

Ask Kate at Get-Your-Best-Mortgage-Rate.com
Dear Mary,

Let's see if I can answer your immediate questions.

I'll also be directing you to other pages on my website. So follow the blue underlined links for more help.

First of all, yes a mortgage broker can and should lock your mortgage rate with the lender. But you need to keep an eye on rates yourself.

I'm not saying you can't trust a loan originator.

Can Mortgage Brokers Lock in My Mortgage Rate
But no one is going to care more about your mortgage than you.

And only you, not the broker, not the lender, will be responsible for the next 30 years to make your house payments.

So don't pass the responsibility of monitoring rates and deciding when to lock to someone else.

This means you will need to understand the lock process and get a feel for current mortgage rates and trends. (More on this in a moment.)

3 Reasons for You to Compare Mortgage Lenders

Based on your letter, I recommend comparing a few more lenders. I say this because...
  • Her broker-status was not clearly disclosed.

  • Her response to your request to lock in your interest rate was that she'd keep an eye on it (observing is not a substitute for locking).

  • The advice to close all of your credit accounts is questionable.
So again, that's why I suggest interviewing a few more lenders, banks, and mortgage brokers.

Do This Before Interviewing Mortgage Originators and Brokers

What's your first step? Give yourself a crash course on Good Faith Estimates. The form was overhauled by the Housing and Urban Development (HUD) to help borrowers understand the cost and terms of their mortgage. I walk you through line-by-line and by the time you are done reading it, you will be a pro!

Then learn how to qualify lenders. Deciding on a mortgage broker or a direct lender's loan originator is like filling a job opening. You are the employer and will be interviewing prospective employees. That's why I say, qualify your lender before you ask to be qualified for a loan.

Help for this is found at How to Compare Mortgage Lender Representatives with Ease.

Next, read through my mortgage rate lock series. I purposefully kept the pages short so you can zero in on key concepts, such as getting lock agreements in writing. This page also addresses cancellation fees.

Lastly, follow Kate's Mortgage Rate Report at my mortgage blog so you can track weekly changes in mortgage rates as well as upward or downward trends. You will also find more help for comparing mortgage rates and trends here.

Above all, keep this in mind. If in doubt, lock in your mortgage rate!

Good luck and best wishes,

Ask Kate

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Comments for Can Mortgage Brokers Lock in My Mortgage Rate.

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Current bank did not process loan timely lock date lapsed
by: Carlos G from Laguna Niguel, CA

I've been with this bank for 5 years. Our current rate is 4.2%. In April 2013, we locked a rate of 3.54%.

The senior processor was hard to reach and had to be pushed to respond by the loan officer. The appraisal was not order by processor but by the loan officer after I inquired.

I also reminded them on the 10th of the month about the deadline of 15th, to which I was assured not a problem. Of course now it's sorry nothing we can do unless rates go down.

What are my options other then contacting the attorney general?

Hi Carlos, Kate here:

Argh! This ugly practice of letting mortgage rates expire when the market tanks really irks me!

Although it should not be your problem to deal with, you are going to have to roll up your sleeves and get to work. Getting the low rate you locked in at is probably going to take some time.

I don't buy into the excuse that it's the processor's fault! So start with your loan officer who should have been monitoring the processor! That's part of his/her job! Let him know you are not accepting a higher rate since you fulfilled your responsibility of getting your documents in on time.

If there is no acceptable solution offered to you, start up the ladder. By the way, I don't recommend asking the loan rep for a supervisor. Occasionally, they will pass you off to a buddy who masquerades as someone with authority.

Rinse and repeat your way up the ladder until you reach someone with decision making authority who will do the right thing!

Best wishes, Kate

P.S. Use their corporate website to find someone with a title that infers they have authority. In addition, go to How to Compare Lenders for the link to the Nationwide Mortgage Licensing System Consumer Access where you can get an inside look into mortgage companies and originators.

Click here to add your own comment.

You can also ask Kate about your mortgage at How to Find Your Mortgage Lender.

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