How Locking a Mortgage Rate Can Be Beneficial for You

When interest rates are rising, you should pay extra attention to rate quotes from your lender. You don’t want to end up having to pay for a loan with a really high-interest rate that could cost you thousands of dollars on top of the principal amount. If you need to lock your rate, you should do so early in the process. In this guide, we’ll talk about mortgage rate locking and how you can take advantage of it.

What Is a Mortgage Rate Lock?

Basically, when a lender locks your mortgage interest rate, they agree to give you a certain interest rate for a set amount of time. This allows you to know how much you will pay monthly for your home loan before your loan actually closes. A lender will ask for an upfront payment for locking your rate.

It’s important to note that no one can guarantee the exact interest rates in the future. If interest rates drop, you will still get the lower rate, but if they rise, you’ll end up paying the higher rate. Your lender will tell you how rates change the price based on their calculations.

How Does Mortgage Rate Locks Work?

A rate lock is sometimes called a rate hold. It is when you, as the borrower, and your mortgage lender agree to a specific interest rate that will apply to your mortgage loan. For example, you and your lender agree to a loan at a fixed rate of 5% but don’t sign the loan documents. Your lender will agree to lock the rate for you so that you don’t have to worry about it going up. This is a great way to lock in a specific rate so that you and your lender are on the same page. You don’t ever want to close on a loan and realize that your rate was higher than you thought. A rate lock will help prevent that from happening.

Normally, a lender won’t agree to a rate lock unless you’ve already gone through a loan pre-approval process. This is because you have already gone through your financial information, and the lender has already run the loan scenario numbers through their computer system to make sure it all makes sense for them. This way, you are more likely to move forward with the loan, and the lender is more likely to sign you on.

Why Would Interest Rates Go Up?

Interest rates with home loans can go up for many reasons. In fact, in recent years, rates have gone up and down quite a bit. It can be hard to predict how much rates will go up or down when applying for a loan. Therefore, it’s essential to lock your rate on your mortgage when you find a loan that you want to apply for.

To lock in a rate, you will usually pay an upfront fee. This is usually only a one-time fee. If you don’t lock your rate, it means that you’re willing to accept whatever interest rate the lender gives you. Therefore, you might have a different rate than your pre-approval, which could cost you thousands of dollars.

Should You Lock Your Rate?

The short answer is yes. There are times when you might not have to lock your rate. For example, if interest rates are expected to go down, you may not want to lock your rate. If they go down, you can simply refinance your loan at a lower rate when the time comes. But most homeowners will want to lock their rate as soon as they can, just so they can make sure they won’t be paying too much interest in the long run.


Mortgage rate locks are a great way to ensure that you will get the rate you want for your home loan. If you’re looking for a mortgage loan, you’ll want to make sure that you look into locking your rate. You can do this by getting a pre-approval from a lender first and then locking your rate. As always, make sure you work with a trusted professional, and make sure you get the loan you need to buy the home you love.

Whether you’re buying a home, refinancing, or need cash from your home equity, Hawkins Home Loans is here to help. We are the preferred online resource for stress-free loan processing with incredibly low rates and amazing service. Apply for a mortgage loan today and let one of our mortgage professionals assist you!