Resource Guide
Mortgage Rate Locks
Protect Your Rate While You Close
Understand how rate locks work, when to lock your rate, and how to protect yourself from market fluctuations during your loan process.
Understanding Mortgage Rate Locks
A rate lock protects you from interest rate increases while your loan is being processed. Learn when to lock, how long to lock, and what factors to consider.
A rate lock is a commitment from your lender to hold a specific interest rate for you for a set period of time—typically 15 to 60 days. This protects you from market fluctuations that could increase your rate (and monthly payment) before your loan closes.
Important: Rate locks are not free. The longer the lock period, the higher the cost (either through a slightly higher rate or lock extension fees). Your loan officer can help you choose the right lock period for your situation.
Best for refinances or purchases very close to closing.
Most common choice for typical purchase transactions.
For new construction or complex transactions.
- You're satisfied with the current rate
- Your closing date is confirmed
- Economic indicators suggest rates may rise
- You've found your property and have an accepted offer
- You prefer payment certainty over potential savings
- Your loan officer recommends locking based on market conditions
- Your closing date is uncertain or far away
- Rates are trending downward
- You haven't found a property yet
- There's potential for your loan scenario to change
- You're comfortable with some rate risk
- Economic news suggests rates may drop
What happens if rates drop after I lock?
If rates drop significantly after you lock, some lenders offer a "float down" option that allows you to take advantage of lower rates (usually for a fee). Ask your loan officer about float-down policies before locking.
What if my lock expires before closing?
If your lock expires, you may need to pay a lock extension fee or accept the current market rate. This is why choosing the right lock period is important. Your loan officer can help you estimate your closing timeline.
Can I lock my rate before I find a property?
Generally, you need an accepted purchase contract to lock a rate. However, some lenders offer pre-approval rate locks for an additional fee. For refinances, you can typically lock once you've started the application process.
Is there a cost to lock my rate?
Rate locks are typically included in your loan pricing, but longer lock periods may result in slightly higher rates. Some lenders charge explicit lock fees for extended periods. Your loan officer will explain all costs upfront.
Licensed MLO Guidance Required
Rate lock decisions should be made in consultation with your licensed loan officer, who can provide personalized advice based on your specific situation, current market conditions, and loan program requirements. All rate locks are subject to lender approval.
Ready to discuss your rate lock options? Our loan officers are here to help.
NorthStar Funding is a licensed mortgage broker. NMLS #139369. Equal Housing Lender. All loans subject to credit approval. Rates and terms subject to change without notice.