So you locked in your mortgage rate and then you found out over while you're
waiting to close on your home mortgage rates just dropped one full percent.
So what do you do?
Are you stuck?
That depends.
And that's what we're gonna talk about next folks.
My name is Dan Frio.
I do the rate update every day to inform you guys everything
real estate, especially on the financing piece of the puzzle.
So what we wanna talk about today is if you locked in your rate, what
options do you have in today's market?
So let's get over to exactly.
Find out what is a rate locked.
So the first thing we see here is the definition, and this is an in Sedia.
So it's a pretty simple term.
And I'll explain it in a little more common sense here in a second.
But a mortgage rate lock is an agreement between a borrower and a lender that
allows the borrower to lock in an interest rate on a mortgage first specific time
period at a prevailing interest rate.
Okay.
So basically it's this, when you start, when you applied for your application
for your mortgage, you were asked, do you wanna lock or do you wanna float?
Okay.
Locking in means you locked it's like buying a stock.
My best analogy is let's look at it this way.
If you're watching a stock that you want to purchase, why you're watching that
stock and doing all your analysis, that in essence, basically refer to as floating.
You didn't buy the stock.
So you're watching things transact, then you're like, okay,
I think it's a good entry point.
So I'm gonna buy the stock.
So now you bought it.
Okay.
So think of that as if you like the interest rate, when
you locked in your rate.
Now you're locked.
Okay.
But the next day or the next month that stock plummeted.
You can't go back to your broker and say here, Mr.
Broker, I'm sorry, but I didn't really want to buy that stock at that time.
Can I big buy it today?
They're gonna laugh at you and say no.
That's, what's gonna happen if you used a bank to do your mortgage, what
they're gonna say is you're locked in.
There's nothing we can do.
That's where the benefit of a mortgage broker comes into play.
What a mortgage broker does is they're set up with probably 10, 15 in our
case, over a hundred different lenders.
What we could do is we can do one of two things.
We can renegotiate with the lender that we locked you into currently
to see if there's float down options or anything we can do for you there.
But if not, worst case scenario.
All we do is take your mortgage application, withdraw it from our current
lender and take it over to another place that has current market rates,
much cheaper than where you are today.
Let's look at the numbers on how dramatically this can change
because the numbers are astonishing.
Let's get to it.
So what we're gonna start is where are mortgage rates?
Okay.
So these are mortgage rates published by mortgage news daily.
And this is today's current rates.
Okay.
In this scenario, it's a $500,000 loan.
It's a 740 credit score, 20% down payment on a 30-year fixed rate,
buying a single family property.
That's gonna be your primary residency.
So that's the backdrop of these rates.
Okay.
So that's not your scenario, but let's work with these numbers for right.
So, you can see right here, let's go to the most commonly
used mortgage for a first-time
home buyer is right in this range here, a 30-year fixed or an FHA.
So we're gonna go work with a 30-year fixed
right now.
You can see down through here, the 52-week high was 6.28.
Okay. So that's what we're gonna say.
That's six and a quarter that wasn't too long ago.
That was under 45 days ago.
So if you're in the process of building a house or maybe you did
a lock and shop, you locked in your rate while you're shopping for a
home, maybe this is what you have.
So we're gonna say the rate went from six and a quarter.
To today's rate is five and a quarter.
So one full percent lower than where we were.
How much a di of a difference is this on your scenario?
The best way to do this is go to the rate, update.com.
It's gonna bring you to our website right here.
You're gonna click down calculator.
And you're gonna pull up the calculator.
So what we're doing here is we're putting in the loan amount or let's
just, we're trying to figure out how much of savings is it for you?
Is it worth a hassle?
What you're probably gonna find out?
Absolutely.
It's gonna be worth a hassle.
So what I did in here is I put in, I'm looking for a
conventional loan on a 30 or fixed.
I put in a $365,000 purchase price on the home, but to make this simple, I
just said, I'm gonna take out everything.
I'm gonna take out the down payment.
I'm gonna take out any taxes, interest insurance, PMI, everything.
I'm just gonna make it all zero to make this as simple as I can.
All right.
So then we're gonna plug in the rate of where we were, where you possibly
locked just a month and a half ago.
That rate is 6.2.
That puts your payment, your principle and interest payment would
be $2,247, but you call this up and we're gonna say, okay, now we can
get you the five and a quarter rate.
How much of a difference is it worth the headaches?
So we go to 5.27.
What happens to the payment?
Your payment now goes to $2,020.
The difference of $230 a month.
Just think it this way, that might be a car payment that might be
able to pay off your credit cards.
That might be, you could apply that extra payments to your student loans.
Heaven forbid you can even put it in a savings account.
So this is the benefits of working with a broker.
And if you're locked in, what I need you to do is send me your loan
estimate what your loan estimate is.
if you applied for a your mortgage with a lender within three business
days, legally, they have to send you what's called a loan estimate.
That loan estimate is gonna break down the whole scenario
that you're applying for.
It's gonna give us your name, the address to the property you're buying
the purchase price of the property, the loan amount, and then all the numbers.
What we're gonna do is we're gonna dissect all those numbers and we're
gonna scan our system over 120 different lenders throughout the whole country to
see what kind of rate we can get you.
Then we'll do a mortgage analysis for you.
Send it back to you to show.
How much money you can save.
So how do you do this?
Where do you get started?
The best thing to do is email me.
My email is Dan@therateupdate.com or all of our description is down below.
And if you wanna find out more about me and my team, like I said, all you have to
do is go to TheRateUpdate.com over in this section, you get our phone number.
We have a Calendarly where you can set up a scheduled meeting
with us personally, one on one.
So we can talk with you in your unique scenario, or we even have a chat
button now that if you're online and one of us on there
we'd be more than happy to answer any questions that you have.
So thanks so much for watching.
God bless.
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Bye bye.