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Changing Rate on Loan Commitment Letter

Can my lender force me to pay a higher loan rate (5.375) than the one in my commitment letter (5.125), if the commitment doesn't expire until March 16th? He says he doesn't have any proof that he locked the rate in back when he issued the letter.  (Posted by Catiba on the Forum.)

 

Editor's Response:

 

Under Massachusetts law, a true commitment letter (as opposed to the more vague pre-approval letter) should bind the lender, as long as it contains sufficient details and all of its conditions are met by the borrower. Depending on the amount of money involved, you may want to talk to an attorney who does litigation, show her the documents, and get her opinion. As usual, the devil will be in the details.

For more information or to post a question, visit our MA Real Estate Law Discussion Forum.

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