The slightest change in interest rates translates into thousands of dollars over the life of the loan. Here are the 5 golden rules of your interest rate lock: Never lock in a rate before the contract is signed. Know what your "on or about" closing day is. Most mortgage lenders offer 15, 30, 45 and 60-day rate locks.
For example, a borrower who chooses a 30-day lock on a loan may pay a 4.875 percent rate and zero points, while a 60-day lock might cost 1.
Rate locks usually range from 30 to 90 days. You may also pay a fee if you extend your rate lock past the initial period (such as your closing date is delayed). Results of the mortgage affordability estimate/prequalification are guidelines; the estimate isn’t an application for credit and results don’t guarantee loan approval or denial.
Is there a "best" day, week, or month to lock your rate?. your interest rate for a particular time span – typically between 10 and 60 days.
A rate lock, of course, is an arrangement where a lender agrees to honor a current mortgage rate – say 4.5 percent – for a specific period of time, such as 30 or 60 days. If market rates go up during that period, you still get the original rate as long as you close within that period.
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The freedom lock option – Freedom Lock is available for new applications on purchase loans at no additional fee, with a maximum interest rate reduction of up to 0.25%. You will have the opportunity to relock one time if rates improve, and your loan must close within sixty (60) days of initial lock.
60-day rate lock: Equal to 30-day mortgage rate + 25 basis points (0.25 percent) Rates locks are available for periods longer than 60 days, but upfront fees typically apply.
As you can see in the example, for the 5.000% interest rate, the point-cost increases from zero points for the 30-day rate lock, to one-quarter of a point for the 45-day rate lock. And for the 60-day rate lock the point-cost increases an additional one-quarter of a point, to one-half point.
However, many lenders will allow you to extend your lock if interest rates have risen. It may even cost you nothing to add a day or two, and a.