What is Rate Lock?
A rate lock is a commitment from a lender to hold a specific interest rate for a set period while a mortgage application is processed.
A rate lock guarantees a particular interest rate for a specified number of days, protecting the borrower from market fluctuations. Borrowers meet it after they are ready to proceed with a loan and want to secure a rate. Watch for the lock period length, expiration date, and any fees. If the loan does not close before the lock expires, you may lose the rate or pay an extension fee. Some locks include a float-down option if rates improve. Understand the terms before locking.
Written by Ralo's editorial automation and checked against the site's copy rules.