If you lock mortgage rates over the phone, how do you protect yourself against hidden fees? Unexpected cost is the number one problem for home loan applicants when it comes to locking mortgage rates. No exception is Terri who was informed of $2050 in additional mortgage points a few days after locking in her interest rate over the phone.
My answer to Terri's request for advice is respond to the mortgage company in writing.
Include details of the phone conversation, the verbal agreement and why you decided to lock mortgage rates on that particular day.
Think back to any fees that were discussed.
Send a copy of your letter to the individual representative and the supervisor in charge.
Be aware you might have a project on your hands because I doubt the mortgage company is going to respond with an automatic agreement to eliminate or reduce mortgage points.
Confused over mortgage points and other terminology?
Go to Reducing Mortgage Closing Costs for an easy to understand guide to good faith estimates.
Keep in mind as a last resort you have the right to cancel your application and switch lenders. To be safe, ask about cancellation fees. And keep in mind, if you lock in rates at another lending company, interest rates could have changed. See my guarantee to those who are unsure of timing their mortgage rate lock.
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