What happens if the mortgage is ready to close and you switch companies?

what type of fees do you have to pay? my mortgage contract doesnt say anything about what happens if you dont close on the mortg.... our rate lock expired 8-16-04, they are trying to tell us that they are going to charge us per week a penalty and that we are up to 8 weeks so far($2,400).....

However in the contract it says that if loan does not close by lock in date below( 8/16/04), then the loan will be relocked. When I relock my interest rate will be the higher of the interst rate on the new lock in date or the interest rate noted below. Each with a premium added for the lock extension-

no where does it say what the lock extension is......so shouldnt it be the same $400 charge we paid to lock it in? We've had so much grief with them in not calling us back when they said they would, multiple times..... we would almost rather switch companies..

Something doesn't sound right with that. Penalty for what?!? Watch out with these ridiculous mortgage companies. If your lock in rate expired then that should be it. You should have whatever rate it is now.

That sounds crazy. Our lock in rate expired and it just became the current rate. If we wanted to lock in again then we would lose the original lock in money.

A lot of companies (including Citibank I believe)... charge you a per week or per day fee to extend the rate lock if you do indeed lock.

Its not shady... but like everything in this world... everything can be negotiated IMO if they want your business that bad.

Sorry, i just thought that they were charging you and didn't even ask you if you wanted to extend it.

Did rates go up since you locked in?