Lenders are taking longer to close loans these days.  Deals are dragging on and if it does not fall apart, it will probably close a few weeks after you thought it would.

 

If you find yourself in a bind and cannot close your loan before your rate lock expires, what do you do?  Call the bank ASAP. Usually you can extend the rate lock for a fee, either flat fee or points.  It is good to know up front what the process is for your lender since they are all a little different.  You also do not want to be boxed and get ripped off (just a little) by a dubious loan officer. 

 

When getting rate quotes, ask the following questions:

 

·        What is today’s rate if I lock it for 30 days- for 60 days?

·        Is there a fee to lock in?

·        What if I need to extend the rate lock?

·        Can I get this in writing?

 

Below is a chart from a National Lender on their extension fees.  You can use this as a guide. Ask questions before you lock, not after.

 

Extension period           Cost (% of loan amt) 1 Day                              FREE 7 Day                             .125 15 Day                           .250 30 Day                           .375 45 Day                           .500 60 Day                            .750             

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