How Far Out Can You Lock A Mortgage Rate?
By Bob RedtreeHow far out can you lock a mortgage rate? These tips will help find a good balance between securing a good interest rate, and paying too much in fees.
“How far out can you lock a mortgage rate?”
Many prospective property owners wonder how long they can lock in a guaranteed mortgage rate. Frequently homeowners opt to get pre-approved for a mortgage loan before shopping for a home. This assures that when the prospective buyers find the home they want they will be able to afford it. However, these locked in rates are only good for a certain amount of time. Typically a locked in rate is good for 30 days, and after that time has elapsed the rate has to be recalculated.
I’ve heard there are exceptions to the 30 day rule for locked in rates. How far out can you lock a mortgage rate with an exception.
There are some lenders who will allow for a rate to be locked in for more than 30 days. Some lenders may even offer lock in rates for as long as nine months. However, there are typically penalties associated with extending a locked in rate past the 30 day mark.
What are the penalties associated with locking in a mortgage rate past the typical 30 day window?
Some lenders will charge a higher interest rate than what could be obtained on the present day if the borrower chooses to lock in a rate for more than 30 days. This way the lender is assured of a higher rate in the case of a raise in mortgage interest rates. Other lenders will charge a flat fee for extending the lock in period. For example a lender may charge a $500 flat fee to extend a locked in mortgage rate past the typical lock in window.
Related posts:
- If I Lock In My Mortgage Rate Am I Committed?
- What Happens If My Mortgage Loan Does Not Close Before My Lock Expiration Date?
- Should I Lock In A Mortgage Interest Rate?
- How Do I Know If I Should Lock In A Mortgage Interest Rate?
- Is It Time To Lock In A Mortgage Interest Rate?