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Does Changes To The Contract Unlock My Mortgage Loan?

By Ann White

Does changes to the contract unlock my mortgage loan?  Read here to find out what changes could affect your rate lock!

Due to the volatility of market interest rates, many people could benefit by locking an interest rate with a mortgage lender.  As long as the contract doesn’t change too much, many lenders are willing to lock a mortgage interest rate for up to 45 days.  However, there are various changes that could unlock your mortgage loan.

Asking For Larger Loan

The first change to your mortgage contract which could unlock your mortgage loan interest rate is if you ask for a larger loan.  A mortgage lender offers you a certain interest rate based on their expectation that you could afford the mortgage payment.  If you then decide that you want a larger loan, the bank may feel less secure that you could make the monthly payments.  If this is the case, it is fairly likely that the mortgage lender will unlock your rate and possibly cancel their commitment.

Asking For Different Loan Product

Another change to your mortgage contract which could unlock your mortgage loan interest rate is if you ask for a different mortgage loan product.  A mortgage lender offers you a rate lock based on a certain mortgage product.  If you decide that you want to switch to a different loan product, the mortgage lender will be forced to alter your interest rate.  This is because different products come with drastically different interest rates.

Change in Credit Score

The third change to your mortgage contract which could unlock your mortgage loan interest rate is if you suddenly have a drop in your credit score.  Your lender will most likely check your credit again right before closing.  If negative information suddenly appears on your credit between the lock date and the closing date, your rate could be unlocked.

Related posts:

1. Can Changes To My Contract Unlock My Mortgage Loan?
2. Can A Mortgage Broker Unlock My Current Mortgage Interest Rate?
3. What Happens If My Mortgage Loan Does Not Close Before My Lock Expiration Date?
4. When Is It Safe To Lock In My Mortgage Rate?
5. How Do I Find NVR Mortgage Loan Rates?