LOCKING UP YOUR LOAN RATE

As a homebuyer you've probably heard of a rate lock,or a "lock-in". Then again, maybe not. A rate lock is a lenders guarantee that you will get a certain interest rate, number of points and other cost-related features. But how long does it last?

The lock is good for a specific period of time. In other words, if you fail to complete your home purchase before the clock runs out, and interest rates rise, be prepared to pay the higher rate. Unfortunately though, if interest rates drop during the lock period, you can't take advantage of them unless you rewrite the lock and pay additional costs.

The lock, however, is a relatively safe bet - expecially when rates are bouncing around as they are now. But before choosing a lock, here are a few tips on choosing one safely:

• Whatever lock you choose, get the guarantee in writing. Oral agreements are difficult to prove should it come to that.
• Lock in as many of the costs as you can, the rate as well as points.
• If you see a rate you want, set the lock "on application". On approval means you won't have a stab at rates until the loan application is approved

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