Definition of Lock-In (Rate Lock):
Definition Rate Lock Orange County:
A lender's invitation to guarantee a borrower a certain interest rate and loan terms for a specified period of time expressed in days; 15, 30, 45 or 60 – the longer the days of the rate lock the higher the interest rate, the shorter the rate lock the better the interest rate. This is an important step in the process of getting a mortgage. A borrower needs to inform his lender when he wants the lender to lock-in a rate once the loan is approved, however a good lender will keep the borrower informed and give them a good recommendation as to current market rates and professional advice on where they see interest rates trending. Once a borrower locks a rate, the lender may offer a float down option if rates continue to decrease before the loan is approved. This means the borrower could lock-in at an even lower rate, but the lender will require them to pay more up-front in discount point fees, this is a given!