hoped and planned for, but as mortgage rates are expected to rise, locking down a low rate as soon as you’re able to might not be a bad idea. Because, when you do the math, even a small hike in interest rates, such as a quarter of a point, can make a major difference in the long run — even hundreds — or thousands — of dollars in interest every year. According to Bankrate.com, Randy Hopper, senior vice president of mortgage lending at Navy Federal Credit Union, says that “in this current environment, it makes the most sense to start the process quickly.” How would this work? “The borrower would contact the loan officer and say, ‘Hey, I’ve got a contract on a place,’ and then the loan officer locks in the rate as soon as they review the contract,” explains Hopper. Then again, you don’t necessarily want to rush. “Because of the fear of rising rates, many borrowers rush to lock in a rate as soon as possible,” Lisa Smith explains. “While this might seem to be a good strategy, it isn’t necessarily the best course of action in all situations.”
TALK TO YOUR LENDER
So, what’s the best course of action? You need to talk to your chosen lender and ask some specific questions before you lock down a rate. First, make sure that you know your lender’s rules when it comes down to their mortgage rate locks. “Policies vary by lender,” says Smith (Investopedia), “but borrowers often have the opportunity to lock in a specific interest rate either at the time the loan application is filed, at some point during loan processing, or once the application has been
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