Some problem with our Loan with AMP?

[rooster78]

Hello Guys,
Here is our story ... we did settlement in Q1 2014 and got loan from AMP
(450k for 3 Year Fixed Rate Loan - P&I and 180k in variable rate)
Now, looking at the loan documents (Pre-approval letter and all docs from FMS which we received) I noticed the interest rate was changed a lot for our 450k for 3 Year Fixed Rate Loan - P&I whereas no change in variable part.

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Early Oct 2013 : Mortgage broker gave us loan proposal showing interest rate for 450k for 3 Year Fixed Rate Loan - P&I will be 4.79%

End Oct 2013 : Pre-approval letter shows same interest rate of 4.79%

End Nov 2013 : Copy of Loan Details from FMS shows interest rate of 4.89%

End Dec 2013 : Copy of Loan Details from FMS shows interest rate of 4.89%

Settlement time (Q1 2014) : We were given interest rate of 4.99% and been paying as per 4.99% now.

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I noticed that jump of 4.79% to 4.89% in Dec 2013 and I asked that Q to our mortgage broker and this was his response :

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The fixed rates have changed a bit couple of weeks ago where almost every lender moved up the rates a little bit. The current rate with AMP is 4.89% but the fixed rate always applies on the date of settlement. We can lock in today?s rate but it comes at a cost . I will check with AMP but I believe it is 0.15% of the loans amount.
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He didn't get back to us on it and we didn't follow upon that later either

So wife and I am wondering :
(1) Is this type of scenario very common with the bank? OR
we have been fooled by AMP and/or mortgage broker?

(2) If someone (who also has loan with AMP or any helpful mortgage broker here in this forum) can please check if AMP did really increased the interest rate during the above timeline OR was it by mistake (which can be corrected now) ?

Thanks
Anna and Glen

 

[Terry_w]

The blue bit is correct

 

[Scott No Mates]

What a disaster! 0.2% increase in the rate and you hadn't locked in a property in 6 months of dealing with the bank.

 

[Marty McDonald]

Fixed rates change between applying and settlement and you get the rate they offer on the day you settle.

Most lenders offer a rate lock feature which allows you to secure the published rate for a fee and the lender will hold the rate for up to 90 days.

If you don't rate lock rates can go up before you settle which seems to be what happened in your circumstance. If rates had gone down in between approval and settlement you would have benefited from this.

 

[Peter_Tersteeg]

Sorry to hear this, but brokers and bankers can only really quote rates on any given day. We've got no hope of predicting what they'll be in 6 months time (the best economists in the country usually don't get it right either).

You can lock in todays fixed rate by paying the 'rate lock' fee, most lenders have this feature and as indicated it usually costs 0.15% of the loan amount. It's also generally only valid for 90 days.

In this case the quote was made 12 months prior to the documents being issued, and then it was around 2-6 months before the loan settled and the rates changed again. How long should a quote be valid for?

 

[NPB]

The broker should have offered you the option of locking in the rate for the .15% at approval time not after you inquired after the first rise.