Quick Answer
Your contract and your rate lock are connected through the closing date. If the purchase contract falls through after you lock, your rate lock may expire before you find a new property, though some lenders allow you to transfer it. Ask Patrick how rate locks and your contract would work for your timeline.
You signed the contract, locked the rate, and then the deal went sideways. The good news is the rate is not automatically gone; the question is whether your lender lets it follow you to the next house.
How your contract and lock connect
The term: the closing date. The point where your contract timeline and your rate lock window meet.
The meaning: the lock must survive the contract's timeline. When a contract is extended or falls through, the lock needs attention, either an extension or a transfer.
The real-world play: I review the contract dates against the lock window the day we get the signed paperwork. Aligning the two from the start is what keeps your rate intact through closing.
Can you transfer your rate lock?
The term: rate lock transferability. Applying your locked rate to a new property if the original deal falls through.
The meaning: some lenders offer rate lock transferability, but it is not guaranteed and policies vary by lender. Some allow one transfer, while others do not allow any.
The real-world play: ask your lender about lock transferability before you lock, especially if there is any uncertainty about the property. Knowing the policy in advance helps you plan your next steps.
What if the lock expires?
The term: the expiration. If the contract falls through and you cannot transfer the lock, the lock will eventually expire.
The money: at that point, you would need to lock a new rate when you find another property. If rates have risen since your original lock, your new rate will be higher.
The real-world play: to protect yourself, look for a lender who offers lock transferability or a longer lock period that gives you time to find a replacement property.
The steps to take
- Contact your lender immediately when the contract falls through.
- Ask about transferring the lock to a new property.
- Start searching for a new property quickly to minimize the gap.
- If the lock expires, ask about current rates and lock a new one when ready.
If your contract falls through, your lock may expire or be transferable. Ask your lender about transfer options before locking and act quickly if you need a new property. Make it a great one.
Ask Patrick about rate locks and your contract
Get a straight answer on rate locks and your contract, from the window and costs to the timing that fits your closing.
