PSA: Picked the wrong lender and it cost me $4,000

I had to choose between a local credit union and a big online lender for my refi on a house in Dilworth. Went with the online guys because their rate was 0.25% lower on paper. But they dragged the appraisal out for 3 weeks and almost made me miss my closing date. The credit union would have closed in 10 days flat like they promised. Ended up paying an extra $4,000 in rate lock extension fees and temporary housing. Anyone else get burned by going with the cheaper rate instead of the faster lender?

3 comments

3 Comments

thompson.christopher18d ago

I mean $4k sucks but 0.25% adds up fast if you keep the house long term.

thompson.tyler18d ago

Hold on, did the online lender actually tell you upfront their typical timeline? Because that's the real key here. A 3 week appraisal delay is insane unless they warned you about it in the fine print. I've dealt with both types of lenders and the local guys usually tell you straight up how fast they can move. The online ones just slap a rate on the page and hope you don't ask questions. You probably should have pushed them on a guaranteed closing date before signing anything. That $4k lesson is brutal but it sounds like you got caught by the glossy rate without checking their actual process.

perez.christopher18d ago

Actually that 0.25% on a $200k loan over 30 years works out to like $10k-$12k total interest, not just $4k. So the online lender's lower rate was only saving you maybe $100 a month. But the $4k upfront cost from the local lender is a guaranteed loss if you sell or refi within a few years. The real math depends on how long you actually keep the house. You've owned it for about 5 years now, right?