Break Mortgage Rate Lock Or Not

by Level Headed Homeowner

Regarding to break a mortgage rate lock or not: Hi Kate, I'd like to say that to break a mortgage rate lock or for that matter, not breaking a lock is a tough question considering the present market conditions.


Many home buyers are leery of mortgage lenders to begin with, thus I would presume any level headed person would look to get the best mortgage rate.

The perils of mortgage lending are quite evident to all intended parties, especially lenders. I need to take into consideration before jumping ship, the following:

1-- Do I have a personal relationship with the lender outside of our current transaction?

2-- If no personal relationship exists, I would seriously consider switching lenders for a lower mortgage rate.

3-- If was into a mortgage rate lock agreement with my current lender, I would probably look to see if I can get the lower interest rate with my current lender first.

If my current lender doesn’t want to lose the deal, I would think they could come up with a way to break the lock and get me the lower interest rate.

4-- Now, if my current mortgage lender is adamantly against breaking the mortgage rate lock, then I would have to switch lenders.

My decision to switch lenders would be solely on the basis of the amortized interest over 30 years, in which the cost of switching lenders is minimal compared to the amount of money I would save with a lower interest rate.

To safeguard against these scenarios is hard but I believe home buyers and lenders must work together to achieve a win-win result.

Kate Answers: Break Mortgage Rate Lock Or Not

Dear Level Headed Homeowner,

Thanks for a level headed assessment of mortgage rate lock options for homeowners. I hope you'll come back to my website Get Your Best Mortgage Rate again in the future. Of course, all of my information is free.

So remember to bookmark Get Your Best Mortgage Rate to your favorites and visit often for up to date homeowner tips, news and advice. You can also invite friends to comment on this page or create a page of their own like you did.

Best Wishes,


P.S. Go to my Best Mortgage Rate Blog, an entertaining source of mortgage information. Subscribe now to the RSS feed.



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Lock Cancellation Fee
by: Fern S

I inquired with my bank about refinancing to lower my current monthly payments. They informed me of the current rate and I said I would be discussing this with my children. I am 72.

Then I ok'd an appraisal only and knew that I would have to pay for that, whether I decided to refinance or not. No other fees were discussed.

A few weeks later, I decided to not refinance. Also, the banker stated the rates had gone higher now.

A month later, I received a bill for appraisal. Yesterday, I received notice of bill for appraisal plus Lock Cancellation Fee.

What? Never heard of that.

I was never told of locking in a rate. Checked paperwork about this fee and don't understand this. Any assistance? Thank you.


Hi Fern, I'm so sorry to hear you are going through this.

1. Request in writing that you want to see the original document you signed agreeing to locking in your interest rate and paying a cancellation fee.

I highly doubt it exists.

2. Ask how your specific mortgage rate increased (per your loan officer's instruction) since the document you received in the mail says your rate had been locked.

Or another way to look at is this -- How can a bank charge to cancel a rate that was never locked?

Fern, I've said it before but it's worth saying again. This treatment of homeowners is not right and it shouldn't happen.

Good luck straightening this out and please let me know if you have more questions.


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