Some lenders require a deposit or application fee before locking a rate. Others do not. Check your lender's policy on lock fees and refundability.
Rate lock deposits vary by lender. Understanding the fee structure upfront helps you budget and avoid surprises.
Rate Lock Deposits and Fees
Some lenders require an upfront deposit or application fee to lock your rate. This fee may be a flat dollar amount or a percentage of the loan amount. Other lenders do not charge a separate lock fee but instead build the cost of the lock into the interest rate or points. When I work with homebuyers in San Antonio and the Texas Hill Country, I explain all lock-related fees upfront so there are no surprises.
Lender Policies on Lock Fees
Ask your lender these questions before locking: Is there a fee to lock my rate? Is the deposit refundable if the loan does not close? Does the lock fee apply toward closing costs? Are there different fees for different lock periods? Some lenders offer a free initial lock period and charge only if you need to extend.
Deposit Refundability
If you pay a lock deposit, ask whether it is refundable if the loan does not close due to circumstances beyond your control, such as the seller backing out or the property failing to appraise. Some lenders refund the deposit in these situations, while others do not. Get the policy in writing before paying any lock fees.
