Do I lock in?

[Anonymous]

I just completed all of our loan application paperwork (wow!).  One page asks us to float or lock the 6.00 interest rate (6.6 APR, however).  Should we go ahead and lock in?  How long is that lock good for?

-iwannahouse

[ShanetheMortgageMan]

If it does not specifically say then you would have to ask your lender how long that lock period is for - on average it's 30 days but longer lock periods, even up to 180 days and sometimes longer, can be available.  I have a feeling interest rates might be a little lower on Monday when they are released next, I'd call your mortgage professional after about 9-10AM Eastern Time to inquire where rates are, and what your mortgage professional suggests doing about locking it in, or continue to float and see where rates are headed.  I use the website http://www.mortgagenewsdaily.com/mortgage_rates/blog/ to monitor direction of MBS's (mortgage backed securities) which is one of the primary driving forces in determining interest rate direction.

[Anonymous]

Shane,

Thanks for the quick reply!  For some reason that part of the app was blank (the number of days it was valid).  I'm hoping if the rate increases on Monday, we can say that we signed today to lock.  And if it goes down, then we can ask them to change it on the application?   I've noticed that it changes from one day to another! And I don't want to get stuck with a higher rate either!

-iwannahouse

[ShanetheMortgageMan]

Yeah if you haven't locked in then you should be able to choose the current interest rate at the time you want to lock (that's actually how it works, you don't get the old interest rate anymore).  Since your lender probably isn't in the office today you would be left to choose from the interest rate on Monday or afterwards.