Question from a Mortgage Porter reader: My Loan Officer Didn’t Lock…What Can I Do?

Last night, I received this email from a borrower who's dealing with yesterday's dramatic rise in mortgage rates:

I was wondering if there was anything we can do if we asked our lender to lock in Monday (which I would suppose would mean Tuesday am) and he didn't because he was sick.  Now he is balking at giving us the rate that he quoted us.  We think that the lending institution should make good on their rate, since we HAD decided to lock in and it was their delay that caused the problem.  Is there a chance for us? 

Monday was Memorial Day and therefore, the mortgage originator probably could not lock and most likely was enjoying a day off.   On Tuesday, it sounds like the loan officer took another day off for health reasons. 

Unless the mortgage originator provided you a written lock confirmation, I'm not sure that you have a leg to stand on.   A rate quote is not a guarantee of rate.  In fact, it's only valid the moment the loan originator is providing it.  Rates change constantly–yesterday, most of the lenders our company works with issued 5 different rate sheets. 

Not being able to reach your loan officer when you want to lock is a risk when floating your mortgage interest rate.  If I have the day off (due to health or vacation) I do have a manager who will take care of locks and/or any issues that may arise.   Consumers may also find it difficult to make contact with their mortgage professional to lock because they may be working with another client at the moment (either locking another loan or in a consultation).  

Not locking your rate at application (if you're closing soon) is gambling the rate not only are your betting that rates will go down, you're risking not being able to lock for the reasons mentioned above and also with constant changing guidelines in this current environment.  Locking the rate is also a form of gambling (that the rate will go up).   Always consider which worse case scenario you can live with when making the decision to lock or not lock.

With that said, rates may come back down since the Treasury is not done spending their allotment towards mortgage bonds (which has been keeping mortgage rates artificially low).  No one can say precisely when this will happen or how much rates will be manipulated lower.