Mortgage scams are common, and primarily involve brokers or lenders deceiving borrowers or withholding information. On the other hand, some borrowers also have a few savvy tricks up their sleeve. Because home prices have increased in recent years, many buyers are unable to afford modestly-sized homes. In some cases, qualifying for a certain mortgage amount is highly dependent on the interest rate received. For this matter, borrowers are constantly shopping for the lowest rate, which can increase the number of mortgage loan fallouts.

When a borrower is quoted a low or reasonable rate for their mortgage, they may choose a loan lock option, which protects them from a higher interest rate if the market fluctuates. In addition to choosing a loan lock, borrowers may also select a float down option. With a float down, if rates were to decrease, borrowers may take advantage of the lower price. Float downs are not automatic. Thus, borrower and lender must agree to this term before locking the loan.

Unfortunately, some lenders do not offer float downs, which can serve to their disadvantage. If working with a first time buyer or a buyer unfamiliar with current rates, these applicants are more likely to accept the lender's terms, and may not be aware of the different interest rate options. On the other hand, if a borrower is very aware of fluctuating rates, they may constantly be on the prowl for a better mortgage deal. For this matter, the borrower may complete a loan request, get approved for a mortgage, and lock the loan without a float down option.

In between the time of the loan locking and final closing, the borrower may apply with another lender, or rates may decrease. In order to receive the better loan offer, the borrower purposely allows the lock on the first loan to expire. This way, they can re-lock (perhaps with a different lender) and obtain a lower rate.