Probably not. The quoted rates are based on numerous assumptions, such as that your credit is good, you have enough income to qualify, you can document your income and assets, you will occupy the house as your primary residence, and on and on. If you don't meet all the assumptions, your rate will be higher.

In addition, the quoted rates apply today. Rates are reset every day, so tomorrow they may be different. What matters are the rates quoted on the day you lock the terms of the loan.

Furthermore, not all rate quotes are believable. Some loan providers deliberately quote below the market to get borrowers in the door. Once inside, they are fair game for a variety of stratagems for raising the rate.
From: http://loan.yahoo.com

Just because the rate you are quote is lower (or higher) than the rate you get doesn't mean anyone pulled the "bait and switch" on you. The truth is that one of the most ignorant questions (and by ignorant I don't mean dumb, I mean unfamiliar with the process) that can be asked is "what are your rates?"

Everybody's rates are about the same. Brokers generally get you a better rate than the bank or directly from a lender.

When you see rates advertised it's almost always an advertising gimmick. In the industry we call people who advertise rates or closing costs "the liar's club".

Let me give you a very good example. Today, right now, the 30 year fixed rate can be advertised at 5.45 with an APR of about 5.9 - so you call and I answer the phone using the industry standard example:

Me: Thank you for calling, how may I help you?
You: Yeah, what are your rates?
Me: 5.45
You: Thank you. *click*

Your scenario:

Buying a new home for $120,000 to live in. You make $65,000 per year, have a middle credit score of 598, 2 late payments on your credit card, a court order to pay child support and you've only been on your new job for 18 months and you switched industries.

But see, we didn't cover those questions and this is where the mortgage industry blows it every time.

Now here's a real example of what would happen when you called me:
(End Part One – Continued in Part Two)