interest rate fluctuation

[sarvissa]

I'm in the process of buying a home.  We are pre-approved, have found the home we want, and have hammered out a price with the seller.  This process has taken about 6 weeks.  During the prequalification process, the rate on the day the LO wrote the GFE was 6.75.  A few weeks later, when she was writing up the pre-approval GFE it was 6.375.  Last Friday she emailed me and told me it was 6.25 that day, do I want to lock in?  I was going to, but got busy at work and didn't get a chance to get back to her in time.

Now today I get an email at 12:42pm, saying interest is 6.0.  17 minutes later, I emailed her back and said yes, let's lock in.  An hour or so later, she emails me back and says:

I’m sorry I didn’t respond right away, our rates were going through a change when I received your response.  I can still lock you at 6.0% but there is a .125% fee (it would come to $195.94) to lock it there.  It’s a very small fee, and would save much more than it costs in the long run.  Otherwise I can lock you at 6.125%.

Is that normal to change that quickly?  I know it can change daily, but within just a few minutes here and there?  And should I hold off, accept the rate, or pay the fee?

[ShanetheMortgageMan]

Rates can change several times a day.  About 10:20AM Pacific Time quite a few lenders started to reprice their interest rates for the worse.  I think we might see rates increase through the holiday weekend so it's your call on how adverse to risk you are.  Keep in mind rates have fallen quite a bit since you started, it's only natural they'd start going back up at some point or another.

[BrianB_The_Loan_Professor]

---

@sarvissa wrote:

I'm in the process of buying a home.  We are pre-approved, have found the home we want, and have hammered out a price with the seller.  This process has taken about 6 weeks.  During the prequalification process, the rate on the day the LO wrote the GFE was 6.75.  A few weeks later, when she was writing up the pre-approval GFE it was 6.375.  Last Friday she emailed me and told me it was 6.25 that day, do I want to lock in?  I was going to, but got busy at work and didn't get a chance to get back to her in time.

Now today I get an email at 12:42pm, saying interest is 6.0.  17 minutes later, I emailed her back and said yes, let's lock in.  An hour or so later, she emails me back and says:

I’m sorry I didn’t respond right away, our rates were going through a change when I received your response.  I can still lock you at 6.0% but there is a .125% fee (it would come to $195.94) to lock it there.  It’s a very small fee, and would save much more than it costs in the long run.  Otherwise I can lock you at 6.125%.

Is that normal to change that quickly?  I know it can change daily, but within just a few minutes here and there?  And should I hold off, accept the rate, or pay the fee?

---

Rates can change and do change many times through out the day

That is why it is so hard to answer the question

"Where are your rates"

 There are no two scenarios that are the same and there are always changes to the market.

There was a mid day price change

Your call I dont know if rates will stay down or not but 6% is pretty solid - As far as the fee

If someone would have asked you 6 weeks ago when you thought you were going to be at 6.75% if you would pay $200 to get 6% what would you have said

Thats not a lot of money in the grand scheme of things

Brian

[sarvissa]

Thanks for the info.  I decided to go for it, and pay the fee for 6.0%.   I had been told previously by the LO to email it by 3:30 as the locking desk closes at 4.  Today I was in conversation with her assistant, and the assistant told me to email "before 4pm".  So I emailed her at 3:29 and said let's go for it.  She emailed me back about 4:15 and said that my email came through at 3:57 and it was too late to lock. 

We're all trying to hurry the process up as much as we can, as the sellers have offered $100 a day for every day that we close before Dec 22.  I signed the counter offer last Thursday, the appraisal was done Saturday, and the inspection is tomorrow!

[ShanetheMortgageMan]

Well rates are better today so if you didn't lock you shouldn't have to pay the .125 fee to get the 6% rate.

[sarvissa]

5.5%!!!!!!  OMG she called me a few minutes ago, it's 5.5, and I locked!  This is so amazing!  We have a rocky credit history, many many lates in 2006, going into 2007.  My mid score pulled by the lender is 692, hubby's is 700.

Thanks guys!

[Mizsass]

Nice! Our loan officer called about 30 minutes ago as well to tell me the rate had dropped to 5.5% with no points and we locked in as well

[BrianB_The_Loan_Professor]

Good thing you were hanging out by the phone Congrats

Thise rates literally lasted less than three hours and are back up again

what do they call that on EBay

Nice Snipe

That is an awesome rate