What happens between submitting an application and locking your rate?

Hi, this is Jason Skelton with Pacific National Lending.

Welcome to another Q&A session where I answer mortgage questions from you all on the internet.

Today's question is:

"What happens between submitting an application and locking your rate?"

Summary:

Jason walks through the window between application and rate lock, explaining that it is an active monitoring period rather than a waiting period. Once a borrower applies, the file goes into the system and the team begins collecting documentation for underwriting and processing. At the same time, they monitor rate movement using subscription services staffed by analysts who study the market much like a stockbroker would and issue float-or-lock recommendations. Jason shares those recommendations with borrowers rather than deciding for them, leaving the borrower in the driver's seat on timing. A borrower can lock whenever they are ready, with one practical constraint: the lock must leave enough runway to meet the required close of escrow.

Answer:

When somebody applies with us, we get all their information into the system so we're ready to go, and we start collecting everything we need for underwriting and processing. While we're doing that, we're also monitoring the rates. We subscribe to several different services staffed by professionals — almost like a stockbroker who analyzes the market, watches what's going on, and predicts where rates are going to go. Those services give recommendations on whether we should float or lock. We share those recommendations with our borrowers and let them be in the driver's seat on when they want to lock. If they want to gamble a little and float it, that's their call. If they're happy with where the rate is right now and they want to lock it in, we do it whenever they are ready — as long as it still gives us enough time to meet the necessary close of escrow. The borrower makes the decision; we provide the information and the timing guidance.