The purpose of the rate spread is to determine how that transaction compares to the APOR at the time the rate is set. If the rate is locked based on investor prices at a certain time (i.e. the original lock date), and the the pricing in effect at that time is used through different extensions, then I think it makes a ton of sense (practically speaking) to use the original lock date for the APOR from the time the pricing is actually pulled from. I don't think the regulation is as clear as Randy and Dan suggest it is saying otherwise either. What is meant by "exercises discretion?"
i. Rate-lock agreement. If an interest rate is set pursuant to a “lock-in” agreement between the financial institution and the borrower, then the date on which the agreement fixes the interest rate is the date the rate was set. Except as provided in comment 4(a)(12)-5.ii, if a rate is reset after a lock-in agreement is executed (for example, because the borrower exercises a float-down option or the agreement expires), then the relevant date is the date the financial institution exercises discretion in setting the rate for the final time before final action is taken. The same rule applies when a rate-lock agreement is extended and the rate is reset at the same rate, regardless of whether market rates have increased, decreased, or remained the same since the initial rate was set. If no lock-in agreement is executed, then the relevant date is the date on which the institution sets the rate for the final time before final action is taken.
Has there been any official guidance on this making it clear that an extension automatically changes the rate set date? I know for fair lending analysis comparing rate spreads, resetting the rate set date based on extensions, muddies the water of the analysis. If borrower A and borrower B, both got the same pricing at application, and borrower B ended up needing an extension 45 days later after pricing has changed, you're not going to be comparing apples to apples. The purpose of the metric is served by using the date the pricing actually comes from.