If you decide not to lock in your rate right away, here are some actions you can take to ensure you don’t miss out on a good interest rate. First, talk with your lender about the decision to hold off. Ask your lender what costs are associated with locking in a mortgage rate. Make sure that you’re comfortable with the cost and how your APR may be affected.Communicate With Your Mortgage Lender
Also, ask how long a lock will last. Rate locks often last 15 – 60 days, but the exact time frame can vary based on the lender. You should choose a time frame that’s long enough to move your loan through the underwriting process.
Finally, ask your lender how the process to lock in your rate works so you’ll be prepared when you’re ready.
Watch The Markets
Researching and recognizing the best mortgage rates can be tough, but it can also help you decide when the right moment is to lock in your rate. You can check in regularly with Rocket Mortgage® to see the current interest rates.
Remember that no one can predict the future. With the volatility and fluctuations of the markets, it can be difficult to pick out the lowest point for mortgage rates. As long as you lock in an affordable rate that you’re comfortable with, it can be worth watching the markets.
It’s worth noting that, at the end of 2021, the Federal Reserve foreshadowed up to three increases in the federal funds rate this year. The first of these Fed rate hikes occurred in March – which was the first time the Fed has raised rates since 2018 – and as many as six more increases are now predicted for 2022.
Combined with plans to back off purchases of agency mortgage-backed securities, these increases create an environment where mortgage rates are likely to continue rising in the future.
So if you need to purchase or refinance, it might be a good idea to exercise a mortgage rate lock and secure your interest rate sooner rather than later.
