This process comes with potential pitfalls that are important to keep in mind, though. Some lenders charge fees to lock in a rate, and others charge fees to extend them if you don't close in time. Additionally, it's possible that rates will drop after you lock in yours, meaning you'll lose out on lower rates or risk paying a fee to unlock and nab the lower rate. While mortgage rates change constantly and are unpredictable, certain circumstances could make locking a good choice:.
A mortgage rate lock could either help or hurt you since your rate stays frozen in place whether market rates rise or fall. A frozen rate protects you if rates climb, but it also means missing out on lower rates if they go down.
Some lenders offer a float-down option, which allows you to switch to the new, lower interest rate even if you've already locked in. But read the fine print first: You may pay extra for this option, and you may have to pay another fee if you opt to float down.
It's important to do the math and ensure the potential rate savings is worth the cost of fees to lock and then float. When you lock in your mortgage rate, it's not indefinite—it can be anywhere from 15 to 60 days, sometimes longer. You should aim for a long enough period to cover the loan closing. If you think your lock-in period won't be long enough, ask your lender if you can switch to a longer one or extend your rate lock—just be aware that some lenders charge a fee for this.
If your rate lock expires and you don't extend it, you'll likely have to pay the mortgage rate that's current as of closing, which could be higher or lower than the locked rate. Keep in mind that if you do get stuck with a high rate and rates drop significantly in the future, there's always the possibility of refinancing. Get Your Credit Mortgage-Ready While market conditions play a huge role in mortgage interest rates, so does your credit score.
The better your credit, the better chance you have of qualifying for a mortgage and landing lower interest rates.
So before applying for a loan, take some time to get your credit mortgage-ready. You can monitor your credit for free through Experian to watch your progress and find ways to further improve your score. It's Time for That Loan Whether you are shopping for a car or have a last-minute expense, we can match you to loan offers that meet your needs and budget.
The purpose of this question submission tool is to provide general education on credit reporting. The Ask Experian team cannot respond to each question individually. However, if your question is of interest to a wide audience of consumers, the Experian team may include it in a future post and may also share responses in its social media outreach. If you have a question, others likely have the same question, too.
By sharing your questions and our answers, we can help others as well. Personal credit report disputes cannot be submitted through Ask Experian. Beyond that time frame, you might have to pay a higher fee to extend the lock — typically, the longer the lock-in period, the higher the fee. Some lenders charge a separate fee for a rate lock. If your rate expires, you could be subject to a higher rate. Sometimes that includes an additional fee you might have to pay in order to lock in your rate again.
The float down option allows you to lift the rate lock if rates fall. Some lenders allow you to float down the rate until closing, while others set limits.
For example, you might be able to request a lower rate just once after asking for a rate lock. But always check with the lender, and ask whether they charge a fee.
Advertiser Disclosure. How a rate lock works How to lock in a mortgage rate Why it makes sense to lock in a mortgage rate Frequently asked questions What is a mortgage rate lock? Keep in mind: No one can predict what rates will do.
They can move up or down a few basis points, then settle right where they were when you started the process. Enter your loan information to calculate how much you could pay Loan amount? Interest rate? Fixed loan term? Enter the amount of time you have to repay your loan years. These typically include documents we need you to upload, third-party steps you need to arrange like inspection, appraisal, title etc.
Checking in on your list daily is the best way to keep things moving. We also recommend taking a proactive approach with third parties in the process. Follow up soon and often with service providers who are taking care of things like your appraisal, inspection, title, insurance, etc.
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