No, there is no requirement that the lender allow the borrower to lock a rate. But there are many state laws that require the lender to tell the loan applicant if the rate is floating or fixed, or may be fixed before closing. The purpose of these laws is to inform the applicant of the nature of the loan, not to guarantee a fixed rate.
Guess my question is why (if the borrower wants to lock) would you not do so as per his instructions? If borrower wants to float the new loan, given the new investor and valid changed circumstance, don’t see a requirement to lock, but if the borrower wants to, I sure would!