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The economy is in the tank, Greece is blowing up, unemployment is persistently high, the Fed is considering buying more mortgage backed securities, and you have a year until closing. You’ve got a LONG time and minimal if any upward pressure on rates. I would NEVER recommend doing a 1 year lock, and paying for the privilege of doing so. My experience with locks over 90 days is that in most cases, there will be ample opportunity to lock on rate dips. As you stated, the rate is significantly higher for long term locks. 4.75% is around .75% over most current pricing. Even if rates were to get a little worse, you would still come out better than 4.75%, and likely much better. Think the only thing you’d be locking in is a rate higher than you would need to while incurring an unnecessary expense!
Hi… Im a residential realtor in tx and building a new home. The house wont be ready until sept or october of 2012. We can do a one year extended lock which as of today would get you an interest rate of 4.75 since the extended lock gives you a higher than market rate, plus we would pay ½ a point to do it. You can float once but within 45 days of closing. Is it worth locking or should we wait? If i wait, at what rate would be worth the ½ a point and security of a decent rate?
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