Rate Locked In

When we quoted the house, the interest rate used was 4.5%. All was fine and dandy with our estimated mortgage payment. We are not people who follow the market and as first time buyers, we weren't very educated on how much interest rates fluctuate and the several factors that can affect it. Fast forward 3 months and now we are here, dealing with a good economy and rising rates.

Our estimated date of completion at signing and pre-construction meeting was May 1. We were hoping to settle any time after June 1. Right before we knew that the new unemployment rate was going to be released, we tried locking. That was about a week ago. We contacted Patti (loan officer) and Frank (PM) to get their two cents. At that point, the rate of the day was 5% (ugh). Frank brought to our attention that some electric meter needed for the house to pass inspection could be delayed (two months!!), so he didn't feel comfortable telling us to lock in just yet. He would have more information at the end of this week.

We asked for today's rate and, sure enough, it increased to 5.125% due to unemployment numbers. Patti said the Feds were meeting again this Wednesday and most likely we will see another increase. We don't want to be stuck with a mortgage we can't afford comfortably! So I called my PM. He told me that even though he still doesn't know for sure if we will have the meter this week, he was being extremely cautious and that he is 90% confident that he can complete our home in 90 days. He wanted us to avoid paying for a rate extension. However, at this point, we decided we were going to pay for a 180 day lock anyway, the way rates are increasing, ev n if we couldn't lock for 90 days.

Long story short, WE LOCKED OUR RATES TODAY. We actually bought points to have the rate dropped to 5%, so that's what we will luckily have. Fingers crossed that we will have no major delays that will keep out home from being ready by June 13 :)