Rate locks explained: length, extensions and the fine print
Float-down options
Lock note
A float-down option lets you take a lower rate if market prices improve after you lock. It is not standard: some lenders charge for it, require a minimum improvement before it can be used, and allow it only once and only within a window before closing. Read the conditions before paying for one.
Last reviewed against the primary sources listed below.
Conditions lenders often set
- A minimum market improvement before it applies.
- A single use.
- A deadline before closing.
- An upfront or added cost.
Alternative
Some borrowers ask whether a lender will reprice if rates fall sharply, without a formal float-down. Policies vary widely.
Rate lock questions
Is a float-down worth paying for?
Only if the cost is low relative to the chance prices improve enough to meet the lender's threshold before your deadline.