Florida Statutes 494.0069 – Lock-in agreement
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(1) Each lock-in agreement must be in writing and must contain:
(a) The expiration date of the lock-in, if any;
Terms Used In Florida Statutes 494.0069
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Borrower: means a person obligated to repay a mortgage loan and includes, but is not limited to, a coborrower or cosignor. See Florida Statutes 494.001
- Commission: means the Financial Services Commission. See Florida Statutes 494.001
- commitment: means a statement by the lender setting forth the terms and conditions upon which the lender is willing to make a particular mortgage loan to a particular borrower. See Florida Statutes 494.001
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Institutional investor: means a depository institution, real estate investment trust, insurance company, real estate company, accredited investor as defined in 17 C. See Florida Statutes 494.001
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- Lock-in agreement: means an agreement whereby the lender guarantees for a specified number of days or until a specified date the availability of a specified rate of interest or specified formula by which the rate of interest will be determined or specific number of discount points will be given, if the loan is approved and closed within the stated period of time. See Florida Statutes 494.001
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage broker: means a person conducting loan originator activities through one or more licensed loan originators employed by the mortgage broker or as independent contractors to the mortgage broker. See Florida Statutes 494.001
- Mortgage lender: means a person making a mortgage loan or servicing a mortgage loan for others, or, for compensation or gain, directly or indirectly, selling or offering to sell a mortgage loan to a noninstitutional investor. See Florida Statutes 494.001
- Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
- Mortgage loan: means any:(a) Residential loan primarily for personal, family, or household use which is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling, as defined in…. See Florida Statutes 494.001
- writing: includes handwriting, printing, typewriting, and all other methods and means of forming letters and characters upon paper, stone, wood, or other materials. See Florida Statutes 1.01
(b) The interest rate locked in, if any;(c) The discount points locked in, if any;(d) The commitment fee locked in, if any;(e) The lock-in fee, if any; and(f) A statement advising of the provisions of this part regarding lock-in agreements.
(2) The mortgage lender shall make a good faith effort to process the mortgage loan application and stand ready to fulfill the terms of its commitment before the expiration date of the lock-in agreement or any extension thereof.
(3) Any lock-in agreement received by a mortgage lender by mail or through a mortgage broker must be signed by the mortgage lender in order to become effective. The borrower may rescind any lock-in agreement until a written confirmation of the agreement has been signed by the lender and mailed to the borrower or to the mortgage broker pursuant to its contractual relationship with the borrower. If a borrower elects to so rescind, the mortgage lender shall promptly refund any lock-in fee paid.
(4) Before issuing a mortgage loan rate lock-in agreement, a mortgage lender must have the ability to timely advance funds on all mortgage loans for which rate lock-in agreements have been issued. As used in this section, “ability to timely advance funds” means having sufficient liquid assets or a line of credit necessary to cover all rate lock-in agreements issued with respect to which a lock-in fee is collected.
(a) A mortgage lender that does not comply with this subsection may issue mortgage rate lock-in agreements only if, prior to the issuance, the mortgage lender:
1. Has received a written rate lock-in agreement from a mortgage lender that complies with this subsection; or
2. Has received a written rate lock-in agreement from an institutional investor or an agency of the Federal Government or the state or local government that will be funding, making, or purchasing the mortgage loan.
(b) All rate lock-in fees collected by a mortgage lender who is not in compliance must be deposited into an escrow account in a federally insured financial institution, and such fees may not be removed from such escrow account until:
1. The mortgage loan closes and is funded;
2. The applicant cancels the loan application or the loan application is rejected; or
3. The mortgage lender is required to forward a portion of the lock-in fee to another mortgage lender, institutional investor, or agency that will be funding, making, or purchasing the loan. The mortgage lender may remove only the amount of the lock-in fee actually paid to another mortgage lender, institutional investor, or agency.
(5) For purposes of this section, the term “lock-in fee” means any moneys advanced by the borrower to lock in for a specified period of time a specified interest rate or discount points.
(6) The commission may adopt by rule a form for required lock-in agreement disclosures.