Definition
Your lender locks in your interest rate for 30-60 days (you choose) so rate increases won't affect your final loan terms. If rates rise, you're protected. If they fall, you're stuck with the locked rate.
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Rate locks typically 30-60 days. Protects from rate increases. Expired locks may require renewal at higher rate. Extension fees possible. Lock commitment essential. Written documentation required. Rate expiration date tracked. Closing delays risk expired lock. Professional coordination essential. Market rate movements affect lock value. Commitment to lock critical. Consumer protection provision.
Pro Tip
Lock rate as soon as possible. Track expiration to avoid re-locking at higher rates if closing is delayed.
Example
Interest rate lock at 4.5% protected buyer from 0.5% rate increase before closing.