Rate Lock-in

Definition

  • A written agreement or contract in which the lender guarantees the borrower a specified interest rate, provided the loan closes within a set time period.

Synonyms
interest rate lock-in, lock-in, mortgage rate lock-in, rate hold

Related Terms and Acronyms

  • Commitment Definition,
    • A written agreement from a lender promising to lend money on certain terms for a specified time period.
  • Lock-in Definition,
    • A lender's guarantee that the mortgage rate quoted will not change for a specific period. The borrower wants the lock to stay in effect until closing.
  • Mortgage Rate Definition, Very Important,
    • The interest rate on a mortgage loan.
    You can compare mortgage rates using this website by clicking 'Rates' above.
  • One-year Adjustable Definition,
    • Mortgage whose annual rate changes yearly. The rate is usually based on movements of a published index plus a specified margin, chosen by the lender.
  • Pre-approval Definition,
    • A process that mortgage lenders use to determine how much money they would lend you based on a thorough review of your financial situation. Lenders issue a pre-approval letter which strengthens your position when bidding on a home, as it shows sellers that you will be able to raise funds needed to purchase.
  • Purchase Agreement Definition,
    • A written promise to pay a specific amount for a property at a specified time. The purchase agreement is a written statement of the offer, which both the borrower and the seller will sign if the offer is accepted.
  • Rate Definition,
    • Percentage a borrower pays for the use of money, usually expressed as an annual percentage.
  • Rate Hold Definition,
    • The length of time, typically between 60 and 120 days, that a lender will guarantee a loan's interest rate once you are locked in.
  • Variable Rate Mortgage (VRM) Acronym, Very Important,
    • Home loan in which the interest rate is changed periodically based on a standard financial index. Also called an "Adjustable-rate Mortgage."
    A type of mortgage loan offered by brokers and lenders.
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