Inspection and financing contingencies can push closing past your rate lock. An extension may be needed if past lock. Build buffer time into your contract.
Contingencies protect you as a buyer, but they can also extend your timeline. Planning for delays helps keep your rate lock intact.
How Contingencies Can Delay Closing
Common contingencies that can delay closing include the inspection contingency, financing contingency, and appraisal contingency. If any of these take longer than expected, your closing date may shift. For example, if the inspection reveals issues that require further negotiation, the timeline can stretch by days or weeks. For buyers in San Antonio and the Texas Hill Country, I recommend building extra time into each contingency period to account for unexpected delays.
Rate Lock Extensions for Contingency Delays
If a contingency pushes your closing past your lock expiration, contact your lender about an extension. Most lenders will extend for a fee, typically based on how many extra days you need. The sooner you notify your lender, the better your options will be. Waiting until the lock has expired reduces your flexibility.
Building Buffer Time Into Your Contract
Your purchase contract should include realistic timeframes for each contingency. Add a few extra days beyond the standard period as a buffer. Instead of a 7-day inspection period, consider 10 days. Instead of a 21-day financing contingency, consider 25 or 30 days. This buffer gives you room to negotiate without pushing past your rate lock expiration.
Preventing Contingency-Related Rate Lock Issues
Choose a rate lock period that extends beyond your expected closing date. If you expect to close in 30 days, lock for 45 or 60 days. The extra cost of a longer lock is typically small compared to the cost of extending or replacing an expired lock. Work with an experienced agent and loan officer who can coordinate contingency deadlines with your lock expiration.
