What Is Lock in Agreement

A lock-in or rate lock on a mortgage loan means that your interest rate won’t change between the offer and closing, as long as you close within the specified time frame and there are no changes to your application. … And, a rate lock may lock you out of a lower interest rate if rates fall after you get your loan offer.

What is meaning of lock in?

phrasal verb. If you lock someone in, you put them in a room and lock the door so that they cannot get out.

What is a lock in clause?

lock-in clause. A mortgage provision that prohibits prepayment of the loan during a portion or the entire term of a loan. The purpose of such mortgage agreements is to ensure that the lender receives its anticipated yield during the lock-in period.