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How do I lock in my mortgage? If you’re a home buyer, this may be a question you are asking yourself over and over right now. Luckily, we have the answer.

As you itemize your budget for the month, you notice that everything is organized and looking good. You have the money that you need to pay your bills, with some leftover to put into your savings every week. Your income and output are in a good place. You feel like you have adjusted to a comfortable situation. The only question you have is for the bank through which you have your house loan: how do I lock in my mortgage?

Locking in your mortgage rate gives you a sense of security about your home loan closing in two ways. First, it sets your own mind at ease about mortgage rates, which change daily. Sure, it’s possible that a lower rate is available next week; however, it’s equally possible that a higher rate is set next week. By locking in at a rate you feel comfortable with, you ease the anxiety of riding the mortgage rate roller coaster. Second, it gives you confidence about your buying power. Sellers prefer home buyers who are not just pre-qualified but who are pre-approved, which means they’ve already gone through the underwriting process to satisfy lender requirements.

The first action you will want to take is talking to your lender. Ask them about when it will be possible to lock in your rate; this is usually once your application has been submitted. Next, you need to ask your lender about other costs that may fall on you, such as fees to lock your mortgage or extend the lock (the agreement to lock your rate should extend until you close on your home, and you may want to ask to include a three-day buffer in this period). You will also want to ask about the possibility of any fees you pay being refunded if you decide to cancel your mortgage application. Make sure that you understand the process of locking in your mortgage and paying any necessary fees.

It is time to do some research. Look into mortgage rates and when they are predicted to rise or fall. In the end, while your broker or lender can advise you, you get to decide when to lock in your mortgage, so you will want to be educated on the details.

At 1st United, our team is dedicated to answering all your questions about the home loan process, and putting your mind at ease when it’s time to lock in a mortgage. Contact us today when you are ready to learn more, and we will help you understand the timeline for closing and when it’s best to wait versus locking in a rate.

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