[dnorus]

Rate Locks are to be written and signed agreements by our borrowers from what I gather on this unclear rate lock topic.
My lenders feel that if they check the box on the LE that “YES” they have a rate lock, that is all they need, as that is their agreement. I disagree with this comment from my Residential Lenders.
My lenders then said, if we had the borrowers sign the LE then we would have that written agreement. Again, I disagree. My take on this Rate Lock debate is it should be a separate agreement stating the rate lock, signed by both the borrower and the lender, and provided at the time the LE is issued. (With the box marked yes if you are providing this separate agreement). Can anyone help give a clear definition as to this rate lock agreement and if the LE is considered as such agreement?

[rcooper]

Commentary to Regulation Z indicates a written agreement is required for a rate lock.

37(a)(13) Rate lock.
1. Interest rate. For purposes of § 1026.37(a)(13), the interest rate is locked for a specific period of time if the creditor has agreed to extend credit to the consumer at a given rate, subject to contingencies that are described in any rate lock agreement between the creditor and consumer.

1026.19(3)(3)(iv)(D) also discusses rate lock implying a written agreement.

Finally, the preamble (. 191) to the TRID final rule states the following:
Regarding the situation where the
creditor has a policy to honor the rate
quoted without a rate lock agreement,
both proposed § 1026.37(a)(13) and
comment 37(a)(13)–1 expressly
contemplate a rate that is locked for a
specific period of time pursuant to a rate
lock agreement. Accordingly, where a
creditor has a policy to honor the
quoted rate, but does not lock the rate
pursuant to a written agreement with
the consumer, the creditor would
disclose ‘‘no’’ pursuant to
§ 1026.37(a)(13)(i). The Bureau believes
this disclosure is appropriate to aid the
consumer’s understanding of the
transaction, because the creditor would
not be bound by an agreement to
provide the interest rate to the consumer
at consummation.

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