When Should You Lock Your Mortgage Rate When Buying in Salt Lake County?

Most Salt Lake County buyers lock their mortgage rate once they have an accepted offer, choosing a lock period long enough to cover the settlement date in their contract plus a few days of cushion. Before you have a property under contract, most lenders cannot lock a rate for you. Once you do, waiting to lock is a bet that rates will drop before closing.

Charisse Walker is a real estate agent with Chalker Properties Group in Salt Lake and Davis County, Utah, and a licensed mortgage lender. Buyers in Salt Lake City, West Jordan, Sandy and across the county ask about rate locks right after their offer is accepted, usually the same day they start lining up the inspection.

This is general education, not loan advice for your situation. Your lender's lock agreement sets the exact terms for your loan.

A rate lock is your lender's commitment to hold a specific interest rate and price for a set number of days. The price includes any points you pay or lender credits you receive.

The lock is tied to the details of your loan as they stood on the day you locked:

• The loan amount and your down payment
• The loan program, such as conventional, FHA or VA
• The property and how you will use it
• Your credit and income as the lender reviewed them

If one of those changes, the lender can change the pricing even while the lock is active. That is the part most buyers do not expect.

Get the lock confirmation in writing. It should show the rate, the points or credits, the program and the expiration date. A rate quote in a text or an email is not a lock.

Lenders commonly offer locks of 30, 45 or 60 days, and some offer longer ones. Longer locks usually cost more, either as a slightly higher rate or as added points, because the lender is holding the price for more time.

To choose a length, start with the settlement deadline in your purchase contract. Then add a cushion for the things that slow closings down:

• An appraisal that takes longer to schedule or comes back with questions
• Condo or HOA documents the lender needs to review
• Title issues on an older home or an estate sale
• Holidays, when title offices and lenders work shorter weeks

A Salt Lake County closing set for the week of Thanksgiving or late December is a good reason to choose the longer lock. New construction is its own case, because the build can run months, so ask your lender about extended lock options before you sign with a builder.

If you are still choosing a loan type, our guide to fixed and adjustable-rate mortgages covers the trade-offs.

Floating means you wait to lock, hoping rates move down before closing. Nobody can predict where rates will be in two weeks, including your lender.

Two questions settle it for most buyers:

1. Does the payment work at today's rate? If it does, locking takes the guesswork out of the rest of the process.
2. Would a higher rate break your budget or your approval? If a small rise would push your debt-to-income ratio past what your lender allows, floating puts the purchase itself at risk.

Some lenders offer a float-down option. If rates fall after you lock, you may get a one-time chance to move to the lower rate. The cost and the rules vary from lender to lender, so ask for the details in writing before you count on one.

If you want a lower rate from day one, a buydown is a separate tool. Our article on mortgage rate buydowns explains how they work.

A lock protects you from market moves. It does not protect you from changes to your own file. These are the common ones:

• The loan amount changes. A low appraisal or a renegotiated price can change your loan-to-value, and that can change your pricing.
• Your credit changes. A new car loan, a new credit card or a late payment before closing can lower your score.
• You switch programs. Moving from FHA to conventional, or from a 30-year to a 15-year loan, usually means a new lock.
• The closing slips past the lock date. Then you need an extension or a new lock.

The safest stretch of your financial life is the time between the lock and the closing. Hold off on new credit, keep paying every bill on time, and tell your lender before you move money between accounts. If your credit needs work before you apply, our guide to preparing your credit 90 days before a mortgage is a good place to start.

You have two common paths, and both can cost money.

• A lock extension. The lender holds your rate for extra days, usually for a fee. The fee is set by the lender, and longer extensions cost more.
• A relock. If the lock expires, you may have to lock again at current pricing. If rates went up, you pay the difference.

Who pays an extension fee is often part of the conversation when a delay happens. If the seller caused the delay, your agent may be able to negotiate for the seller to cover it. Raise it early, while there is still time before the lock runs out.

Charisse Walker is a real estate agent with Chalker Properties Group in Salt Lake and Davis County, Utah, and a licensed mortgage lender. She watches settlement deadlines and lock dates together, because a missed lock date is one of the easier closing costs to avoid.

• Choosing the shortest lock to save a little. If the lock expires a few days before closing, the extension can cost more than the longer lock would have.
• Assuming a quote is a lock. Until you have a written lock confirmation, your rate can move.
• Buying furniture on credit before closing. New debt can change your pricing or your approval.
• Waiting too long to decide. Floating without a plan often turns into locking on a worse day out of nerves.
• Not reading the lock terms. Find out what happens if the loan amount or closing date changes before it happens.

Here is a typical example, not a specific client.

A first-time buyer in West Jordan has an accepted offer with settlement set about 40 days out, landing the week after Thanksgiving. The lender offers a 30-day lock or a 45-day lock. The 30-day lock is a little cheaper, but it would expire before settlement unless closing moves up.

The buyer asks the lender what an extension would cost if they took the 30-day lock and closing ran late. The extension would cost more than the difference between the two locks, so the buyer takes the 45-day lock.

The appraisal comes back a week later than planned because of the holiday. The 45-day lock still covers the new closing date, and the buyer closes at the rate they locked without paying for an extension.

Can I lock my rate before I find a house?

Most lenders lock only once you have a property under contract. Some offer programs that hold a rate while you shop, usually with conditions and a cost. Ask your lender what they offer.

Does it cost money to lock a rate?

A standard lock is often built into your rate and points. Longer locks, extensions and float-down options usually carry a cost. Your loan estimate and lock confirmation should show it.

If rates drop after I lock, do I get the lower rate?

Not automatically. You would need a float-down option in your lock agreement, or you would have to discuss a relock with your lender.

Does a rate lock mean my loan is approved?

No. A lock holds pricing. Your loan still has to clear underwriting, the appraisal and the rest of the lender's conditions.

Can I change lenders after I lock?

You can, but the lock stays with the first lender. A new lender means a new lock at their pricing, and it can slow down your closing.

Charisse Walker is a real estate agent with Chalker Properties Group in Salt Lake and Davis County, Utah, and a licensed mortgage lender. Her lending background means she knows which lock questions to ask early, so your loan timeline and your contract deadlines line up instead of working against each other.

If you are buying your first home, the first-time buyer guide walks through the whole process, from pre-approval to closing.

Planning a Salt Lake County purchase? Contact Charisse to talk through your timeline, your financing and your next steps.