A quoted rate is only good for a period. If your closing runs past the lock, you may reprice at whatever the market is doing then — which can change your economics after you have already committed to a purchase.
These questions cover how locks work and how to avoid the common timing problems.
Quick answer
A rate lock holds your quoted pricing for a set period, commonly 30 to 60 days. If closing extends past the lock, extensions are usually available at a cost, or the loan reprices at current market. Confirm your lock length and extension terms before you rely on a quote.
Frequently Asked Questions
What is a rate lock?
A commitment from the lender to hold your quoted rate for a defined period, protecting you from market movement between application and closing.
How long is a typical lock?
Commonly 30 to 60 days on investor loans, though this varies by lender. Longer locks are sometimes available at a cost.
When does the lock start?
Usually when the rate is formally locked, which may be at application or later in the process. Clarify the start date, as it determines your deadline.
What happens if my closing runs past the lock?
You either extend the lock, usually for a fee, or the loan reprices at current market rates. Neither is ideal, which is why timeline management matters.
How much does a lock extension cost?
It varies, commonly expressed as a fraction of a point per period extended. Ask the specific cost before you need it.
Can I lock before I have a property under contract?
Generally no. Locks are tied to a specific property and loan file. Pre-approval indicates likely pricing but does not lock a rate.
What is a float-down option?
A provision allowing you to capture a lower rate if the market improves during your lock period. Not all lenders offer it, and it usually carries a cost.
Should I lock immediately or float?
Locking removes uncertainty; floating bets on rates improving. On an investment property where your returns are modeled on a specific rate, most investors prefer certainty.
Does the lock guarantee my exact rate?
It holds the base pricing, but adjustments can still apply if your file changes — a lower appraisal, a different loan amount, or a changed credit profile can all reprice the loan.
What can void a rate lock?
Material changes to the file — property value coming in low, loan amount changing, credit deteriorating, or occupancy or property type changing from what was underwritten.
Do all lenders offer locks?
Most do, though terms and lengths vary. Some non-QM lenders lock at a different stage than agency lenders, so confirm the process.
What causes closings to run past the lock?
Appraisal delays, title issues, entity documentation problems, and requests for updated statements. Most are preventable with early preparation.
Can I re-lock at a lower rate if the market drops?
Only if your lock includes a float-down provision or the lender permits a re-lock, sometimes with a fee or a waiting period. Standard locks do not automatically capture improvements.
Does a longer lock cost more?
Usually yes. Longer locks carry more risk for the lender and are priced accordingly. Take the shortest lock your timeline realistically supports.
What lock length should I request?
One that matches your realistic closing timeline with a modest buffer. Ask your lender what typical timelines look like for files like yours.
Is the lock in writing?
It should be. Get the lock confirmation, the expiry date, and the extension terms documented rather than relying on a verbal commitment.
Does a lock apply to points as well as rate?
Typically the lock covers the full pricing structure including points. Confirm this, as some structures lock rate only.
What if the lender misses the deadline through their own delay?
Many lenders will extend at no cost when the delay is on their side. Raise it directly and ask — it is a reasonable request.
Do rate locks apply on refinances?
Yes, and the same considerations apply. Refinance timelines can be less predictable than purchases, so build buffer into the lock length.
What is the most useful question to ask about locks?
How long is the lock, what does an extension cost, and what are the most common reasons files at this lender run past it. That last question tells you what to prepare for.
