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These two optional mortgage features offer you the safety of a guaranteed maximum interest rate, even if mortgage rates rise before you close your mortgage.
Is rate protection right for me?
Rate protection allows you to establish a maximum rate for closing with the ability to receive a lower rate if rates drop (provided your closing date does not extend past the rate protection term). In the event that rates decrease, you will have a one-time option to lock into a lower rate, regardless of how low they go.
Prior to choosing a home, you can opt for 90- or 120-day rate protection when you use Merrill Lynch's Qualified BuyerSM program to obtain preapproved for a loan.
Unless otherwise prohibited by state law, an associated fee based on the amount of the loan is required to protect a rate. The fee is credited back to you at closing.
Rate protection features:
- Available for home purchases, refinances and preapprovals.
- 30-, 60-, 90- and 120-day options are available when purchasing a home.
- 60-day option is available when refinancing a home.
- If rates increase before your loan closing, the protected rate does not increase beyond your cap rate.
- If rates decrease before your loan closing, you have a one-time option to lock at the lower rate.
- If you are purchasing a home, you have a 55-day window between 5 and 60 days prior to closing to use your one-time lock option at any point from time of sale to five days prior to closing
- If you are refinancing your home, you have a 10-day window between 5 and 15 days prior to closing to use this one-time lock option.
If you have not utilized your one-time lock option prior to the fifth day of your scheduled closing date, you will receive the lower of your protected rate OR the current market rate 5 days prior to closing.
Is a rate lock right for me?
A rate lock option is also available at any time during your loan process once a contract of sale has been secured, provided your closing date does not extend past the lock term. Unlike rate protection, the rate lock option does not provide the opportunity to choose the lower rate in the event that rates fall.
Unless otherwise prohibited by state law, an associated fee based on the amount of the loan is required to lock a rate. The fee is credited back to you at closing.
Rate Lock features:
- Available for home purchases and refinances after a closing date has been set.
- 30-, 60-, 90-, and 120-day options are available when purchasing a home.
- 45- and 60-day options are available when refinancing a home.
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