You’re semi-seriously thinking of buying a home in the next four months
You’re considering locking in your variable rate to a 5-year fixed if rates rise, but your lender won’t hold a good rate for you
You’re casually thinking of refinancing but prefer to wait for fixed rates to rise so that your IRD penalty falls
You want to hold a rate on a different term than you were pre-approved for elsewhere
…then an ING Direct rate hold might be your cup of tea.
A rate hold does just what it says: It holds you a rate for 90-120-days.
Having a rate hold is like having a free option. For instance: assume you run out and get yourself a 3.74% rate hold. Then suppose global risks subside and the economy recovers strongly. That 3.74% rate could jump to 4.50% or more over 3-4 months. If that happens and you have a rate hold for 3.74%, you’ve saved yourself over 3/4 point.
Of all the rate-hold options out there, ING has one of the better, for four reasons:
ING rate holds are free and entail zero obligation
It’s really easy to get one (It takes ~60 seconds. Either you fill out the form or your mortgage planner can do it.)
ING has among the best mortgage features in the business
ING lets you lock in a rate for 120 days with no credit check and no application.
Things to remember:
A rate hold means nothing if you don’t meet the lender’s qualifications. Always consult with a mortgage professional first to confirm that you do.
A mortgage planner will sometimes offer you a better rate than what you can get through ING directly (The 3.74% example above is 5 bps below ING Direct’s normal rate. ING-approved brokers will sometimes do that or better). Moreover, a mortgage planner provides professional advice, full service, and hand-holding throughout the process—at no cost.
ING lets you extend your rate hold any time. That means you can get a brand new 120-day hold at ING’s then-current rates, anytime you want.
ING isn’t the only game in town, of course. Your mortgage planner can identify which lender has the best rate hold for your particular circumstances.
If you know for sure that you’ll be closing on a new home within 120 days, you’ll likely find cheaper pre-approvals elsewhere—albeit with more steps and restrictions.