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What Happens If My Mortgage Loan Does Not Close Before My Lock Expiration Date?

By Ann White

Secrets to keeping your mortgage loan rate lock even if it expires.

If your rate lock expires, you may risk a higher interest rate on your mortgage loan. Loan officers and borrowers alike work hard to close loans within thirty days in order to preserve the best rate. However, if your loan doesn’t close before the lock expires, you can still defend your rate.

When your rate lock expires

If you don’t close your loan within the time frame of a rate lock, it will expire. This mean that you can lose your rate. If interest rates have gone up, your rate may go up. It is important to advocate on your own behalf if this happens. Exercises your rights as a borrower. If the loan closing is out of your hands and you lose your rate, you have every right to get it back.

How to lock your rate

Mortgage loan rates change daily. Your loan officer will request a signed interest rate lock agreement in order to lock the rate you want for your loan. You are not guaranteed an interest rate until it is locked. Some mortgage companies require a rate lock fee, so ask your broker about any fees upfront.

Understand your rate lock

The rate lock tells the lender that you plan to borrow a set amount of money at a set interest rate. the lender then hedges the loan amount and interest rate against the amount of time you need to close the mortgage loan. Thus, you have a set amount days to get your loan closed in order to keep the specified rate.

Length of rate lock

Typically, a rate is locked for thirty days from the time your loan officer communicated the interest rate and loan amount to the lender. You can request a longer long if you think you will need more time to close your mortgage loan. Inform your real estate agent the date of expiration on your rate lock when filling out your contract. Keeping an open line of communication will prevent losing your rate.

Related posts:

1. If I Lock In My Mortgage Rate Am I Committed?
2. What If Mortgage Interest Rates Change Before I Close On My Home?
3. How Far Out Can You Lock A Mortgage Rate?
4. How Long Does It Take To Close A Mortgage Loan?
5. Is It Time To Lock In A Mortgage Interest Rate?

One Response to “What Happens If My Mortgage Loan Does Not Close Before My Lock Expiration Date?”

1. Charlie Balton says:

   June 15, 2010 at 9:54 pm

   Hello I appreciate the new post.