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Locked in refi rate, payed appraisal, delayed closing 75 days re-ran credit, and DONT qualify?

I thought it I locked in my rate it was a done deal. Can they do this? by glimre_386_311 from Spokane, Washington. Jul 25th 2012 Reply


Bert Carpenter (BertCarpenter)
#40 ranked lender in Arizona - 1,821 contributions

Locking an interest rate has nothing to do with whether or not your loan will be approved, it only has to do with guaranteeing a specific rate, one your loan is approved and loan documents are prepared for signing. My question to you is what happened to your credit in the interim that caused your score to change so you no longer qualify. You want to know the specifics. If you are working with one of the big banks, that is part of your problem. They only have their own programs. Instead, contact a local Mortgage Banker/Broker. We have access to loan products of many lenders, not just those of one bank, and can better guide you. But more importantly, we are trained to take a look at the various different options available to you and guide you into the one that makes the best sense for your situation. Unlike a bank employee, who is most likely just an order taker, a Mortgage Broker/Banker is Trained, Tested and Licensed in all aspects of Mortgage Origination. Also, rates have trended downward in the last 90 days, so it is likely that you could get a better rate today than you locked for. Don't forget to check out your selected Mortgage Originator at the National Mortgage Licensing System at www.NMLSConsumerAccess.org ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950

Jul 25th 2012
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Michael Eiden (MichaelEiden)
#30 ranked lender in Oregon - 23 contributions

Unfortunately they can. Escpecially if it's been 90 days since they first pulled your credit. It also depends on how long your initial lock was for. Most lenders only allow you to extend it twice. It might be best for you to find out exactly why your score dropped and see if it can be easily rectified. If so, have your lender lock with another investor, or take your business elsewhere. Good luck to you.

Jul 25th 2012
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Travis Torcoletti (travis.torcoletti)
#0 ranked lender in South Carolina - 372 contributions

Sadly that can happen...they will usually rerun credit later in the process, called a credit update, to see if anything major changed like you took on a large debt or had a default of some sort. A locked rate only means that your rate won't go up for a specified time, usually 45-60 days. Sorry...what happened though?

Jul 25th 2012
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,620 contributions

I would ask why you no longer qualify.. Did your credit score drop?.. Did the program change?... a good loan officer wont just tell you your denied.. they will tell you how to get approved... I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714

Jul 25th 2012
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Equitus Mortgage (EquitusMortgage)
#66 ranked lender in Washington - 39 contributions

Yes this does happen. Why did they deny your application? Was it because of the loan to value?

Jul 25th 2012
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Peter Botros (PeterBotros)
#70 ranked lender in New York - 895 contributions

Certainly possible, locking in a rate does not guarentee that you qualify. it only gaurentees the rate if you qualify. What was the reason for not qualifying?

Jul 25th 2012
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Michelle Curtis Loan Originator NMLS 401173 (EmbassyFundingLLC)
#76 ranked lender in Florida - 2,240 contributions

You have gotten many great answers. It is never a done deal. All lenders are different but the average time to rerun credit is when it is 90 days old.

Jul 25th 2012
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Michael Mullin (TheLoanConsultant)
#48 ranked lender in Washington - 12 contributions

The crux of the matter is you chose to work with a lender that treated you that way. There should have been no misunderstanding about how the lock works, what your options for extending the lock were, and the fact the appraisal was non-refundable. That was a poor loan officer you were working with unfortunately.I'm sorry that happened to you and sadly we talk to people like you on a weekly basis that have been abused by other lenders. They can increase regulations and pass more laws all they want to "protect" the consumer but I've not seen one yet that gives you recourse for incompetence of the lender. It's a shame because there's way more financial damage being caused through incompetence than there ever was through intentional misdeeds.Interview 1 or 2 other lenders and tell them exactly what caused you to disqualify. They can probably offer suggestions on how to fix. Rates are still low enough you probably haven't lost out in that regard. You are just out the appraisal fee.If you'd like help give us a call.

Jul 25th 2012
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