Rate Lock
A temporary hold on your mortgage interest rate.
Definition
A rate lock is the lender's commitment to hold your interest rate for a set period while your loan moves through processing and underwriting.
Category: Pricing
Why a rate lock matters
Mortgage rates can move daily. Locking protects you from market swings while the file is being processed, which can be especially important on larger loans where even a small rate change materially affects payment.
What to verify before locking
Confirm the lock period, the rate, any points or lender credits attached to that pricing, and the cost of extending the lock if closing gets delayed.
Common mistake
Many borrowers focus only on the rate number and miss the fee structure. Two locks can show the same interest rate while carrying very different upfront costs.
Related glossary terms
- Loan Estimate - The early disclosure that outlines a mortgage offer's rate, payment, and fees.
- Closing Costs - The collection of fees charged to finalize your mortgage and transfer ownership.
Related loan programs
- Conventional Loans - Conventional loans aren't backed by a government agency, follow Fannie Mae and Freddie Mac guidelines, and reward strong credit with the lowest rates and most flexible terms available.
- Jumbo Loans - Jumbo loans finance home purchases above the annual conforming loan limit set by the FHFA. They require stronger credit and reserves but offer competitive pricing on luxury and high-cost area properties.
- Refinance Loans - Refinancing replaces your current mortgage with a new one — to lower your rate, shorten your term, switch loan types, or pull cash out of your equity. The right refinance depends on your goal, not just current rates.