Rate Lock Extension Fee-Reissue Closing Discl.

Answered by:

Question:

I'm getting mixed answers on this question - we issued a closing disclosure, but the seller postpone at the last minute. The closing is now back on, but the rate has expired and is being extended. Is adding a rate lock extension fee a valid change of circumstance to reissue a closing disclosure?

Answer:

If you are referring to needing an extension of an investor rate lock agreement, I would say you have a changed circumstance. If your customer is going to have to pay that extension fee, you need to ensure than your customer gets a revised closing disclosure within 3 business days of the bank realizing there will be an added fee, or at the closing, whichever comes first.

If the seller pays for the extension fee (which seems fair given the information you have provided), you would need a revised closing disclosure at the closing, showing the fee in the paid by seller column but would not have to meet the three-business-day date.