Mortgage Rates Rising: Should You Lock Now?

Mortgage rates moved higher this week. Should you lock now or float?

Lock immediately if:

✓ You're under contract on a home
✓ You need the mortgage soon (next 2-4 weeks)
✓ Rates have been rising (trend is up)
✓ You're comfortable with current rate

Don't gamble when you have a deadline.

Consider floating if:

✗ You're not under contract yet
✗ You won't need the mortgage for 6+ weeks
✗ Rates have been falling (trend is down)
✗ You can absorb a 0.5% rate increase

Floating adds risk but might save money if rates drop.

The math on rate changes

$600K loan:

• At 6.75%: $3,925/month
• At 7.25%: $4,114/month
• Difference: $189/month

Even 0.5% rate increase costs $100+/month. Lock to protect against risk.

Lock timing

Best practice: Lock when you have signed purchase agreement.

Typical lock period: 30-45 days (covers most closings)

Cost to extend: Usually $200-400 per 15 days

Rate lock vs rate hold

Rate lock: Guaranteed rate, typically 15-60 days
Rate hold: Discount (free or $100-200 fee), usually 7-10 days

For purchase contracts, always lock. For refi, rate hold may work if closing is fast.

Bottom line

Rates are rising. If you're under contract or closing within 30 days, lock immediately.

If you haven't found a property, float short-term and lock when you have an offer.

Don't wait hoping rates drop. Lock when you have real timeline.

Ready to lock a rate? Get A Quote.

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Bill McCoy | 888-421-1117 | mccoy@betteroffers.com