Guide to the Unchangeable Mortgage Rate: When to Lock the Rate

Let’s look at some frequently asked questions about when and why you should secure your mortgage with a fixed rate.

How much does it cost to freeze a mortgage rate?

Generally, there is no charge for freezing initial interest. The charge is usually included in the rate. However, you may pay more to extend your lock-in rate or lock it back in after the initial period ends.

Lenders may charge a fee to extend or refreeze your rate in the form of mortgage points, which would increase your rate slightly. Lock-in rate policies on fees, initial time periods and extensions may vary between financial institutions and loan types. Ask your lender about information related to locking your rate.

Does the type of loan affect the fixed mortgage rate?

The type of mortgage can affect information related to the lock-in rate, including whether they are eligible for a lock and whether they can extend it. Deciding when to lock your interest rate is part of the mortgage process, regardless of the type of loan. However, your loan type can affect other aspects of your mortgage.

How long is an unchangeable mortgage rate lock valid?

Some mortgage lenders offer unchangeable long-term interest rates, including 90-day lock-in periods. However, rate lock agreements are generally no shorter than 15 days and no longer than 60 days. You can pay a fee if you want a longer lock-in rate period.

What happens if my lock-in mortgage rate expires before closing?

If your lock-in rate expires before you close, you have two options: close at the existing mortgage rate or pay for a lock-in rate extension.

Talk to your lender if you’re worried about paying lock-in rate extension fees. They should have a good idea of ​​how long the mortgage loan application evaluation process will take and can recommend the best lock-in rate period for you.