Interest rates have proven to be quite unpredictable, especially in the past few years. Securing a great mortgage rate can significantly impact your home buying experience and more importantly your purchasing power. Rate holds can provide buyers with some predictability by locking in current mortgage rates for up to 120 days. Locking in a rate with a rate hold provides a powerful buffer against rate fluctuations during the house hunting process.

Benefits of a Rate hold

Protection Against Rate Increases: Rate holds are particularly beneficial for buyers when rates are on the rise. By securing a rate, you can proceed with your home search process without the anxiety of rising interest rates affecting your budget or borrowing capacity. If mortgage rates increase during the rate hold period, the borrower retains the advantage of the lower rate initially secured. This can result in substantial savings over the life of the mortgage. 

Protection Against Rate Decreases: Those who might find themselves in a declining rate environment also benefit. If rates decrease during the rate hold period, a borrower can capitalize on the lower available rate, ensuring they receive the best possible deal. This dual benefit underscores the value and flexibility of securing a rate hold.

Budgeting Confidence: Knowing your mortgage rate in advance aids in financial planning, providing stability as you budget for your new home.

Considerations and Potential Costs

Rate hold Premiums: Some lenders charge a premium for a rate hold, especially if the locked-in rate is lower than the market rate at the time of closing. Your Perch mortgage advisor can help you better understand the ins and outs of your rate hold during the application process.

Lender Availability: Rate holds are only offered by a limited amount of lenders, which means your rate hold will likely be less competitive then the rate you’d get if you had an accepted offer and were looking to apply.

For those looking to buy a home and wanting to avoid the pitfalls of changing interest rates, engaging with Perch and exploring your rate hold options is a prudent step. You can get started today by creating an account with Perch and starting a pre-approval. Once your profile is created, one of our mortgage advisors will guide you through securing a rate hold with a suitable lender, tailored to your  needs.

Purchase or renew with confidence by locking in your Rate Hold with Perch Today.

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