What if rates drop after I’ve locked?
If rates drop enough, a float down policy will come into play as an option. You can float your rate down after your rate lock only if the following scenarios apply, and it would cost a 0.5% hit to your closing costs (0.005 x Loan Size) to utilize the float down. These scenarios do not occur often, and we suggest you only lock in on pricing that you are happy with, as most likely you will close without floating down your rate.
Two Possible Scenarios:
Your Loan is Formally Approved with Conditions
If rates have improved at least 0.25% with your same closing costs or better you can float down to that rate with a 0.5% pricing hit.
Your Loan is Clear to Close (No Conditions Left)
If rates have improved at least 0.125% with your same closing costs or better you can float down to that rate with a 0.5% pricing hit.
- Can Empire of America finance the purchase of a property through a short sale?
- Do you have any programs that don’t require income documentation?
- Can I apply before I find a property and get pre-approved?
- Should I consider a loan with private mortgage insurance (PMI)?
- What is the minimum down payment required on a purchase mortgage?
- What is the maximum percentage of my home’s value that I can borrow on a refinance loan?
- What is the maximum debt-to-income ratio allowed?
- Is paying off an existing second mortgage or home equity line considered cash out?
- Can I keep my existing second mortgage or home equity line and refinance my first mortgage?
- If my loan application isn’t pre-approved, does that mean you can’t provide me with financing?
- What is your minimum credit score requirement?
- Am I able to refinance a property that was recently listed for sale?
- What is the difference between a conforming loan, a super conforming loan and a jumbo loan?
- What is an ARM?
- What is a subordination agreement?
- What is a three day right to cancel?
- What is title insurance and why do I need it?
- What is prepaid interest?
- What is the difference between an Interest Rate and an APR?
- Can I prepay the loan without a penalty?
- What happens after I apply?
- What supporting documentation is required?
- How quickly can you close my loan?
- What is your rate lock policy?
- Are any fees collected when I lock?
- What happens if the loan process takes longer than my lock period?
- Can I choose a different program or rate after I’ve locked?
- Can I relock my rate if I cancel and reapply?
- If rates fall after I’ve locked, will you lower my rate?
- Should I lock or float my rate?
- What is an escrow/impound account?
- What are included in your closing costs? What are pre-paids & are they different from closing costs?
- Why do you charge a Lender Fee?
- Should I pay discount points?
- What is a rebate/credit?
- When will I hear from someone after my inquiry/application?
- How can you offer such low rates?
- Is there a fee or any obligation if I apply?