Each Wednesday, the Mortgage Bankers Association releases its Weekly Applications Survey, a detailed look at new mortgage applications submitted over the previous 7 days. This week's report will reveal what most of us already know -- plunging mortgage rates created a flood of mortgage activity.
If you're among the many Americans taking advantage of today's low rates, don't forget that when your rate was "locked", it was locked with an expiration date.
Most likely, that rate lock is for 30 days.
And, while 30 days may seem like a long time, it's not. Especially because rate locks made prior to Thanksgiving lose a combined 14 days to weekends and holidays, plus another 4 days to the Right To Cancel clause.
A 30-day rate lock, therefore, yields just 12 "working" days in which to underwrite and approve the mortgage and that's not a lot of time at all.
Making matters more difficult, many lenders are ill-equipped for boom.
Not only has staff been pared down in expectation of a slowing economy, but December is a prime vacationing month too. Lenders are short-staffed at a very inopportune time.
So, for active refinancing homeowners, the best way to preserve a 30-day rate lock is to be as responsive as possible to the process:
- If paystubs are requested, return them on the same day
- If a home appraisal is needed, schedule the appraisal immediately
- If a closing date is scheduled, don't postpone it by a day
As mortgage rates hang near 3-year lows, the number of refinancing homeowners nationwide will grow, further taxing lenders and their staff. If you already have a loan in process, be pro-active about it to prevent your 30-day rate lock from expiring.
