Answers to Questions about our Locking Policy
What is a Lock, and How Does it Differ from a Loan Approval?
A Rate Lock is a commitment to close a loan at a specific rate, within a certain period of time. When you lock your rate, we accept your commitment that, if approved, you will close your loan with us, and we commit to you that we will honor the rate you locked, provided the loan closes within the specified lock period.
A rate lock is not a loan approval, and all applications must go through the underwriting process in order to be approved. We will evaluate your credit, income, appraisal and other factors to determine if the loan meets the requirements for approval. Once your loan is approved, we can close the loan, assuming all of the criteria used in the approval process does not change before the closing.
A rate lock is not a loan approval, and all applications must go through the underwriting process in order to be approved. We will evaluate your credit, income, appraisal and other factors to determine if the loan meets the requirements for approval. Once your loan is approved, we can close the loan, assuming all of the criteria used in the approval process does not change before the closing.
What Must Be Done Before We Will Lock Your Loan?
We require a completed application in order to lock your loan, and we require that you have a property selected if you are buying a home. We also ask that you provide a deposit of $495.00 at the time you lock your rate. This deposit is credited 100% towards your costs at closing. We ask for this deposit so that we can begin processing your loan, covering the costs associated with items like underwriting, ordering an appraisal of the property and pulling your credit report.
What Happens if the Market Price Rises Before We Can Approve Your Application and Lock Your Loan?
If you elect to submit an application and float your rate instead of locking, you are taking the chance that interest rates may change. You will be required to lock in a rate before closing, and if rates are higher at that time than they were when you submitted your application, you will pay the current market rate. However, if you locked your rate at the time of application, you will be protected from interest rate changes during the lock period. We will close your loan at the rate you locked, even if rates go up.
What Happens if the Market Price Drops Before We Can Approve Your Application and Lock Your Loan?
If you submit an application and float your rate instead of locking, interest rates may change in your favor. When we lock your rate before closing, you will pay the current market rate.
How Long are Locks Good For?
A standard rate lock period is 30 days from the time of application (which is when most borrowers lock their rate). CenturyPoint Mortgage offers longer - or shorter - rate lock periods if required. If you need an extended lock period, such as 45 or 60 days, speak with your Mortgage Specialist for details. Note that there may be a fee for a longer lock period, or for extending an existing rate lock.
How and When Can a Borrower Request a Lock?
You may request a rate lock online at any time. When you request a rate lock online, you will receive a Lock Request Confirmation by email the same day, or the next business day if your request is submitted after 5:30 pm. The Lock Request Confirmation will confirm your requested loan program, loan amount, rate, points and fees.
Online lock requests are not guaranteed until they have been reviewed and accepted by CenturyPoint Mortgage. After we have reviewed your request and confirmed availability of the requested rate and fees, we will provide you with a completed lock confirmation.
For immediate lock confirmation, lock by phone Monday thought Friday, from 8:30 a.m. through 7:30 p.m. EST at 877-998-9900.
Online lock requests are not guaranteed until they have been reviewed and accepted by CenturyPoint Mortgage. After we have reviewed your request and confirmed availability of the requested rate and fees, we will provide you with a completed lock confirmation.
For immediate lock confirmation, lock by phone Monday thought Friday, from 8:30 a.m. through 7:30 p.m. EST at 877-998-9900.
What is Covered By a Lock?
CenturyPoint Mortgage provides details on all of our lender fees in our custom rate quotes. These fees include the costs for credit reports, appraisals, underwriting and other costs associated with your loan. Once you lock your rate, the lender costs are guaranteed not to change if you close your loan before your rate lock expires.
Our lock guarantee does not cover third party fees, which are broken out separately on your quote. These fees are our best estimates, and will be finalized with the third party service providers prior to closing.
Our lock guarantee does not cover third party fees, which are broken out separately on your quote. These fees are our best estimates, and will be finalized with the third party service providers prior to closing.
What Fees Must the Borrower Pay to Lock?
We do not charge a lock fee, however we do ask that you provide a deposit of $$495.00 at the time you lock your rate. This deposit is credited 100% towards your closing costs at closing. We ask for this deposit so that we can begin processing your loan, covering the costs associated with items like underwriting, ordering an appraisal of the property and pulling your credit report.
Under What Circumstances are Fees Refunded?
If you decide to cancel or withdraw your application within 5 business days of application, you may request a partial refund of your deposit by contacting your Mortgage Specialist. The actual amount of your refund will depend on the costs incurred by CenturyPoint Mortgage at the time of your cancellation, such as pulling credit, creating your loan files and starting the underwriting process. For example, if we have secured an appraisal for your property, your refund will be reduced by the cost of the appraisal. Of course, we will also provide you with a copy of the appraisal for your records. Your Mortgage Specialist can provide you with details on the amount of refund you may receive.
What Happens if the Market Price Increases after the Loan is Locked?
When you lock your rate, you are protected from interest rate changes during the lock period. We will close your loan at the rate you locked, even if rates go up.
What Happens if the Market Price Drops after the Loan is Locked?
When you lock your rate, you commit to close the loan at the rate that was locked, even if rates go down. If you ask us to change or re-lock your rate, CenturyPoint must renegotiate with the end investor on your behalf. Investors often charge additional fees to lenders that do not deliver locked loans. There are also additional processing and underwriting expenses involved with loans that have been re-locked. Therefore, borrowers who re-lock must pay an additional $500 underwriting fee.
What Happens if Critical Information in the Application, Such as the Borrower’s Employment, Changes after the Lock?
Any changes to information provided on your application, such as employment, income, assets and property details, may delay or have an adverse impact on your loan approval. If changes to these items occur after a rate is locked, they may extend the length of underwriting process, and your lock may expire before we are able to close your loan.
What Happens if the Borrower Wants to Change the Type of Mortgage (or The Rate/Point Combination) after the Price is Locked?
Any changes to the type of mortgage, rate or points for your loan will require re-negotiation of your rate lock. Because the original lock will be cancelled, we cannot guarantee your initial rate lock terms when the terms of the loan are changed.
What Happens if the Loan Cannot be Closed Within the Lock Period?
If we cannot meet our commitment to close your loan within the initial lock period due to errors or omissions on our part, we will do our best to secure a lock extension for you without additional cost.
Should a lock expire due to delays in returning documents, changes to the loan or other factors that are the borrower’s responsibility, we will work with you to secure an extension to enable you to close the loan at the original terms. If this is not possible, we will offer you our best alternative pricing.
Should a lock expire due to delays in returning documents, changes to the loan or other factors that are the borrower’s responsibility, we will work with you to secure an extension to enable you to close the loan at the original terms. If this is not possible, we will offer you our best alternative pricing.
