Doing a refi with LTV of 67%. Lender says it's 70% and wants to increase my rate?

[Pabs]

Here was I thinking I was a good risk with an appraised LTV of 67%, DTI of 14%, credit score above 720 and locked a rate of 4.875%.  Now the lender reduced the appraised value to an LTV of 70% and wont give us the locked rate.  Is this fair practice?  I thought LTV's of 80% was more the magic number?  I'm skeptical. Can anyone offer advice on whether they think something is amiss here?  Thanks.  Worried refinancer.

[DallasLoanGuy]

Sounds like a scumbag loan officer who floated your rate and lost the gamble.

The delivery charges to Fannie/Freddie for 67% & 70% are exactly the same.... they are ZERO!!! 

 https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0818.pdf

These adjustments are to the 'price' to buy the rate. Consider them discount points. These aren't adjustments to the rate.

Who is the lender? 

[Anonymous]

I'm in refinance situation as well. How do you know your LTV of 67% . Did appraiser give you directly a appraisal amount of your house? or Did you ask your lender?. I want to know about this.  Appraiser came to my house last week. He fowards a report to my lender but I don't know how much. When I locked in the rate, my score was a little low 710 therefore; I couldn't get the lowest rate in that day. IF I know my LTV is less than 60% I will ask my lender to lower my rate to the lowest. IMO my house value is less than 60% LTV but I don't know  how much in a appraisal.  I heard somewhere in Fisco forum, I can't request my report untill after 90 days. DallasLoanGuy or Shane Please Please give me some insight if you know.

Thanks so much

[Pabs]

Thanks for the responses.  I am working with a broker who is working with one lender at the moment - Provident Funding Group.  Thank you for sharing the link, but so I understand correctly, given the credit score and LTV, there should be no adjustment to the price to buy the rate as you say, contrary to what the broker is saying.  Do you have any comment on how you think I should proceed?  I still have the rate lock with free extension, but knowing the rates as they are today, it wont be as good an option.

MoonLight, when I sought a rate quote, it was based on my estimate which was 72.875% LTV.  When the appraisal happened, I asked the broker to confirm the appraisal LTV, which he did as 67.8% LTV (increased appraisal of $43k from my estimate).  Now he says the lender reduced the appraisal value by $29k - which is still above what I estimated originally, which got me the 4.875% rate. 

[Anonymous]

To me it's not fair if the lender reduce your appraisal amount (not your estimate) My question is if the lender can reduce or increase the amount of appraisal, Why do we have to pay for appriser. What are the reasons for the lender to reduce your amount? is it because your appraisal too long a ago etc.

[Pabs]

The appraisal happened 1/12, applied to lender 1/15, got the approval with condition 2/4 - really long process for some reason.  The reason I am told is that the lenders review department added comps that were not included in the appraisers report.  I asked for the detail and now await. 

[DallasLoanGuy]

maybe provident has internal adjustments that do not jive with fannie.

i have requested a provident rate sheet from a colleague

maybe the lender can drop a fee and get you down to  69%?

[Pabs]

Greatly appreciated DallasGuy.

Thanks

[ShanetheMortgageMan]

No difference at Provident, agree with Dallas that the LO didn't lock the rate, was gambling that it would get better.. and it didn't (today it got worse than yesterday) and is trying to pass the buck to you.

[Anonymous]

Pabs. Did you lock your rate by berbal comunication? Did you got GFE with rate locked from broker? or email to confirmed rate Locked.

How do we know LO really really locked and can't chane the rate? Assume will close on time by schedule as GFE.

I'm close in 10 days I don't want this kind of problem happen to me.

Message Edited by MoonLight on 02-06-2009 11:55 AM