Refinancing Advice Needed For Mortgage Rate Lock

by Gordon
(USA)

Here is one reader's question asking for refinancing advice regarding a mortgage rate lock. With mortgage rates dropping to a 7 week low, I imagine other homeowners and home buyers will be seeking out solutions to mortgage rate lock also...

Dear Kate,

We are in the process of refinancing our home. Our locked-in interest rate on a 30 year fixed rate mortgage is 6.125%.

6.125% looked pretty good until the most recent influx of federal reserve money drove mortgage rates significantly lower. Is there anything we can do to take advantage of this latest federal fix? We don't close until sometime in December.

The Mortgage Rate Lock Guarantee

Dear Gordon,

I understand how confusing a mortgage rate lock can be because each lender can have a different policy.

Since you say you already locked in your rate and mortgage rates have since dropped, you are now wondering if you can take advantage of the current scenario to get a lower rate. I understand!

You should have received your mortgage rate lock agreement after locking which usually describes the policy of your lender.

See if there are provisions for a "float down". Lenders will sometimes split the difference with a borrower after rates take a significant drop. You may have paid for this feature when you locked your rate.

There is no magic bullet when it comes to locking in mortgage rates. You can be guaranteed of this refinancing advice... rates will go up, down or stay the same.

Of course it is normal for all of us to want the best deal we can get. Just be smart and don't risk the locked-in rate you already have. Few borrowers hit the bottom when it comes to interest rates because plain and simple, we never know the bottom until it's over.

Here are some links to pages on mortgage rate lock, comparing mortgage rates and reducing closing costs which might help you organize your thoughts before calling your lender.

I hope you'll come back to contribute again in the future.

Of course, all of my information is free. So remember to add Get Your Best Mortgage Rate to your favorites and visit it often. You can even invite friends to comment or rate your page.

Best Wishes,

Your Online Mortgage Advice Friend

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