A mortage lesson: the day we must lock.
Watching And Floating - Interest Rates
The storms that took the power out of the homes and businesses of 1.5 million people in the Pacific Northwest teaches another lesson in our John Daley story. We have to lock today. The story we take you through has John still floating.
What if John wanted to lock Friday? It could not have happened. I was stranded. Most businesses were closed. Even worse, what if we woke up this morning to a crises that set the financial market on it’s heels?
The answer is so sorry, bad luck, nothing can be done. When you float you play the game against mother nature as well as the economics.
Perhaps you can conclude, floating is a gamble I don’t recommend. In our story the rate will be locked today at 1/8% higher than it would have been on November 22nd. There were 2 business days it would have been better for John, but by 1/8%. Not worth it.
Now we have the additonal issue, of closing Friday. It is Christmas week. Much of the staff is getting days off. But to end the story we can assume I faxed the lock in to the bank a couple of hours ago. I have a great relationship with this lender, and have communicatedo our need to rush. The borrower did all they needed to do to get the loan approved to close, the underwriter signed off on all conditions last week, our file is in line for documents later today or first thing in the morning. There are 3 files in line ahead of it. All will be well with the document department. Escrow won’t make an appointment for signing until they receive the doc’s, but I am a regular customer and they will come through for us.
Normally this is too tight of a schedule to be relaxed, not impossible to accomplish, so I end it happily ever after. And the higher payment coming to John, he is well off, he can afford the additional $23.75 a month.
Tune in regularly, Teresa Boardman and I have a new scenario for you to follow.
