New construction won't be done till early Jan can't lock till 60 days before, should I lock early?


We can buy ¾ of a point for $3000 to lock in 120 days ahead instead of waiting tip mid November to lock. 120 days before closing will be Sept 4 or so ( before unemployment numbers come out and before the fed meeting in mid sept). Should we do it? I did the math if mortgage rates goes up only a .35 to 5.0 percent from 4.65% the break even will be in 3 to 4 years with paying 60 dollars less per month.

Question is this a good plan? I don’t see it being lower in mid November even if the fed decides to start the taper in December.


One of the biggest concerns with locking 120 days in advance is whether the builder will actually complete the home in time for final loan approval and closing prior to lock expiration. Yes, there are rate risks, including Fed tapering and potentially bond unfriendly employment reports, but pricing is also better (if market stays the same) on shorter rate locks. Guess if your risk tolerance is low, and your builder completes homes as planned, you could lock now. Seems like there will be windows of opportunity down the road, however, to do shorter locks at reduced cost. Only you (with your LO’s advice) can decide if it pays to incur the cost of a lock that far out.

Answered over 1 year ago
Ted Rood
1375 6

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