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What If Mortgage Interest Rates Change Before I Close On My Home?

By Jim Micheals

When looking to purchase a new home, getting an inexpensive mortgage is quite important. Even a slight variation in mortgage rates could drastically alter how much of a home you could afford.   If mortgage interest rates change right before you close your home, there are several things that you could do.

Get A Rate Lock

The first thing you could do to prevent the risk of an mortgage interest rate change right before you close your home is get an interest rate lock. Most mortgage lenders will allow you to lock your interest rate for a period of 30 to 60 days prior to closing on your loan. Therefore, if interest rates increase prior to closing on your loan, the interest rate you have to pay will remain the same as long as you close within your lock period.

Renegotiate With Lender

If mortgage interest rates change for the better right before you close on your home, you could renegotiate with your lender. Since interest rates have gone down since you locked your rate, you will have to negotiate a new mortgage rate with your lender. In most situations, a mortgage lender will be willing to reduce your interest rate prior to closing without charge.

Get a New Lender

If mortgage interest rates change for the better right before you close on your home, you could also get a new lender. If your current lender is not willing to reduce your interest rate, you could attempt to find a new mortgage lender. However, you must keep in mind that a new mortgage lender will charge additional underwriting and application fees, so switching will come with an expense.

Related posts:

1. What Happens If My Mortgage Loan Does Not Close Before My Lock Expiration Date?
2. How Long Does It Take To Close A Mortgage Loan?
3. What Types Of Inspections Do I Need Before I Close ON My Mortgage Loan?
4. What Is A Good Faith Estimate For A Home Mortgage?
5. What Questions Should I Ask When Shopping For A Mortgage Rate?