Lock-Ins and Fees

Does the lender offer a lock-in of the interest rate and points?

When will the lender let you lock in the interest rate and points? When you apply? When the loan is approved?

Will the lock-in be in writing? If the lock-in is not in writing, you will have no record of the lender's agreement with you in case of a dispute.

Does the lender charge a fee to lock in your interest rate? Does the fee increase for longer lock-in periods? If so, how much?

If you have locked in a rate, and the lender's rate drops, can you lock in at the lower rate? Does the lender charge you an additional fee to lock in the lower rate?

Can you float your interest rate and points for now, and lock them in later?

Loan Processing Time

How long does the lender expect to take to process your loan?

What has been the lender's average time for processing loans recently?

Has the lender's loan volume increased? Heavy volume might increase the lender's average processing time.

Expiration of Lock-Ins

What rate will be charged if the lock-in expires before settlement-the rate in effect when the lock-in expires?

If you don't settle within the lock-in period, will the lender refund some or all of your application or lock-in fees if you decide to cancel the loan application?

If your lock-in expires and you want to get another lock-in at the rate in effect at the time of the expiration, will the lender charge an additional fee for the second lock-in?

Complaints About Lock-Ins

Knowing what to look for puts you in a better position to decide whether, when, and how long to lock in mortgage terms. Also, by helping to keep the loan process moving, you can lessen the chance that your lock-in will run out before settlement.

But what if your lock-in does lapse? If you believe that the lapse was due to delays caused by the lender or someone else involved in the loan process, you should try first to reach a mutually satisfactory agreement with the lender. If that effort fails, consider writing to the appropriate state or federal regulatory agency.

Some lender actions, such as offering lock-in terms which are impossible to fulfill, failing to process your loan diligently, or causing your lock-in to expire are improper--and may even be illegal. In addition, because you may have contractual rights under your lock-in or loan commitment, you may want to consult with an attorney. Be aware, though, that complaints may not be resolved as quickly as may be necessary for a home purchase.

Depending upon their authority under applicable state or federal law, regulatory agencies may either attempt to help you resolve your complaint directly or record your complaint and recommend other action.

State Agencies

State consumer protection offices, banking authorities, and offices of the attorney general can be contacted regarding complaints against many lenders doing business in the state. (Some states have enacted legislation to specifically address complaints about mortgage lock-ins.)

Federal Agencies

In addition, some lenders are directly supervised by federal regulatory agencies, as shown in the list that follows:

Mortgage Companies

Division of Credit Practices
Bureau of Consumer Protection
Federal Trade Commission
601 Pennsylvania Avenue, N.W.
Washington, D.C. 20580
(202) 326-3224

Federally Insured Savings and Loan Institutions and Federally Chartered Savings Banks

Office of Thrift Supervision
1700 G Street, N.W.
Washington, D.C. 20552
(202) 906-6000

State Member Banks of the Federal Reserve System

Division of Consumer and Community Affairs
Board of Governors of the Federal Reserve System
20th and Constitution Avenue, N.W.
Washington, D.C. 20551
(202) 452-3946

National Banks

Compliance Management Division
Office of the Comptroller of the Currency
250 E Street, S.W. Washington, D.C. 20219
(202) 874-4810

Federally Insured Non-Member State-Chartered Banks and Savings Banks

Office of Consumer Programs
Federal Deposit Insurance Corporation
550 Seventeenth Street, N.W.
Washington, D.C. 20429
(800) 424-5488
(202) 898-3536

Federal Credit Unions

National Credit Union Administration
1776 G Street, N.W.
Washington, D.C. 20456
(202) 357-1065

The information contained in this brochure is intended to help you ask the right questions when shopping for a loan. It is not a replacement for professional advice. Talk with mortgage lenders, real estate agents, attorneys, and other advisors, about lending practices, mortgage instruments, and your own interests before you commit to any specific loan.