What is a Rate Lock?
When choosing to get a loan you will often have the opportunity of choosing amongst a variety of products with different interest rates.
Since rates have the ability to change and we don’t necessarily know when exactly they might, Rate Locks allow you to lock in the exact rate you are being offered, to avoid being affected by potential variations.
If interest rates change between application lodgement and settlement, you can still get the rate you were hoping to get! Keeping your peace of mind even while you wait.
When taking a Rate Lock as an option, it is important for you to be aware that they are only applicable on fixed interest rate loans. Many banks offer the option for you to pay a fee in advance to secure the interest rate being offered.
How much does it cost?
What cost can you expect to cover when taking a rate lock? Well, these will vary depending on the lender with whom you are choosing to get your loan.
While some banks may charge a percentage of your loan amount, or offer fixed-rate lock fees, others might offer this option for free. Working together with one of our award-winning Mortgage Brokers is the best way to ensure you have a great understanding of the fees involved with opting in for this option.
When should you get one?
It is a really great idea to get a rate lock if the rate that you have been presented with is fantastic, so you can sleep at night knowing it will not change between now and the settlement of your loan.
Locking it in can give you the confidence to get the rate you are after. A smart decision to avoid waiting until settlement date to discover your rate!
Rate locks basically give you peace of mind. They provide security that you can get the fixed rate you are after without any complications! Our team of experts is always here to help assess whether this might be the best option for your needs. In considering your personal circumstances, dreams and goals, you can trust to receive the best advice.
Ready to get your journey started? Learn more about home loans and property investment loans, or contact us today!
