by Bob from Virginia, USA
Ask Kate: Rate lock and mortgage refinance problems My wife and I recently locked in a interest rate over the phone, a 30 year fixed rate mortgage at 4.875% with a major US bank on May 12th.
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On the same day, my lender sent me the paperwork stating my locked in rate was good for a 60 day lock but I also received a Good Faith Estimate stating a rate of 5.5 percent.
I contacted my lender and he said that it was an error and not to sign any paperwork he sent me. He emailed new paperwork May 20th. I had informed him a week prior that my wife and I would be on vacation May 22nd - May 29th.
Due to unseen circumstances I did not think I would be able to get the paperwork to him before our trip. I informed him of this and he told me that my deadline was May 27th. He had never mentioned this verbally or written, but he stated that it was not a major problem. I was just to get the paperwork to him when I get back from vacation.
But he stated there might be a small fee involved if he does not receive the signed paperwork by May 27th so my wife and I managed to get the signed paperwork he needed to him by the deadline.
He then informed me that he canceled the loan 2 days prior and the mortgage rates went up drastically. He apologized and told me there is nothing he can do for me.
Kate, my question to you is... Is there anything I can do "legally"? Can the lender cancel our loan without my consent?
I know it was a verbal lock in over the phone, but he would not give us a chance to get the paperwork into him. Now my wife and I lost the opportunity of a life time.
This was a really shady thing this lender did, and needless to say my wife and I are furious. Please, give me advice.
You can also ask Kate about your mortgage at Refinancing Advice The Nuts and Bolts.
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