What's a lock-in or a rate lock?

Mortgage interest rates can change daily, sometimes hourly. If your interest rate is locked, your rate won’t change between now and closing, as long as you close within the specified timeframe and there are no changes to your application. Rate locks are typically available for 30, 45, or 60 days, and sometimes longer.

Some lenders may lock your rate as part of issuing a Loan Estimate, but some may not. Check at the top of page 1 of your Loan Estimate to see if your rate is locked, and until when.   

The interest rate on your Loan Estimate is not a guarantee. If your rate is not locked, it can change at any time. If your rate is locked, it can still change if there are changes in your application—including your loan amount, credit score, or verified income.  

Here are some common reasons why your interest rate might change, even though it is locked:

  • You decided to change the kind of loan you are requesting or the amount of your down payment
  • The appraisal on the home you want to buy came in higher or lower than expected.
  • Your credit score changes, for example because you applied for or took out a new loan, or missed a payment on an existing loan or credit card.
  • Your lender could not document your overtime, bonus or other income.

Rate lock policies vary by lender.  Choosing whether to lock your rate can make an important difference in your monthly payment.  To avoid surprises, ask:

  • “What does it mean if I lock my rate today?”
  • “What rate lock time frame does this Loan Estimate provide?”
  • “Is a shorter or longer rate lock available, and at what cost?”
  • “What if my closing is delayed and the rate lock expires?”
  • “If I lock my rate, are there any conditions under which my rate could still change?”

There can be a downside to a rate lock.  It may be expensive to extend if your transaction needs more time.  And, a rate lock may lock you out of better market pricing if rates fall.

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