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Question DetailsAsked on 3/30/2014

What would happen if I switched from a current mortgage lender and went with another?

I just started the process with a current mortgage lender. I paid to start the loan process, they've pulled credit and I've sent documents, but now I have found someone with lower rates and fees. What ramifications would there be if I switched lenders? I have to close 26 days from now

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1 Answer


Sets the clock back to zero time. You cannot "switch" the case to another lender - you would have to cancel out this application, pay/lose any mandatory fees for the time and effort they put into it - probably some hundreds of $, then start over with the new lender with the application and credit check and so forth. If this is a refi you would have to compare how much the present value of the lower rate is against the cost to bail out of the current application to see if worth it to you.

If a new purchase as it sounds like, talk to your Realtor - 26 days is VERY tight for getting a loan approved from scratch, by a month or so probably, so you risk being in breach of contract and losing the house and the purchase contract deposit and the loan application fees and some closing agent costs at this point - andpossibly some fee payment to the Realtor too, since thhis is not due to conditions beyond your control. I would say it is a no-go - the time to be looking for better rates was before you first applied for the loan, not afterwards.

Answered 6 years ago by LCD

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