Home loan interest rate lock

Avoid losing out on a great rate with a home loan rate lock.

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Imagine comparing home loans and finally settling on the perfect loan with the right combination of fees, features and interest rates. You fill out your application and submit it, hopeful that the rate you’ve applied for won’t change in the time it takes for your loan to settle. And then your lender raises your rate. That's where a rate lock comes in handy.

How does a rate lock work?

A rate lock is usually applied before a fixed rate home loan settles as it sometimes may take a certain time to process your home loan application. Once you lock in the rate, depending on the lender and the rate lock available, the rate you apply for will be locked in for up to 90 days before your loan settles.

There’s usually a fee for this, and if during the rate lock period rates go down, most lenders will allow you to enjoy the lower rate - although you’ll still have to pay the rate lock fee. Some rates may be locked in at settlement, and with others it’s when the application is.

Lenders offer rate locks on fixed loans, not variable rate loans.

Case study

Susan has been looking for her dream house for quite some time and finally has found one that suits her and her young family. Her husband and children are also thrilled with the idea of moving into a better, larger and more comfortable home that has a pool and a nice garden.

She has applied for a fixed home loan with a rate of 4.50% fixed for three years, so she can create an accurate budget during this time. She decided that it would be wise to get a rate lock as well.

Some time after submitting the application, the rate for her loan rises to 4.65%. Because of her rate lock she has avoided a rate hike of 0.15%, meaning she is now saving more money on repayments each month.

Pros and cons of a rate lock

Pros

  • No surprises. You can apply for a fixed rate home loan and not worry about rates rising before your loan is approved.
  • If rates drop you can still benefit. If during the rate lock period rates drop, many lenders will still allow you to benefit from the lower rates. As always, check the terms and conditions.

Cons

  • Rate lock fees. Rate locks can cost between $300 to $750 and in some cases even more, so be sure to shop around, and try to get an idea of whether or not rates will be rising or falling so you know whether it’s worth the fee.

Things to consider about rate locks

When considering buying a home with a fixed rate home loan and using a rate lock, you should consult a financial planner or mortgage broker first. These kinds of professionals can tell you more about the prices on the market and will be able to tell you whether the rates might drop or rise in the short term.

You should note that even with the best experts, it’s difficult to forecast where rates might be over the course of a year or even a month.

Also keep in mind that some fixed rate home loans have a free rate lock. Free rate locks are usually shorter than rate locks with fees, generally lasting for 60 days as opposed to 90 days. Still, a free rate lock could save you hundreds of dollars and guarantee that you receive the rate you apply for.

FAQ about rate locks

How long will the rate lock last for?

You can usually lock a rate in for 90 days before your loan settles.

What loans qualify for a rate lock?

A rate lock is generally only applicable on fixed rate home loans.

What if rates go down during the rate lock period?

Most lenders will enable you to enjoy the lower rates; however you will still have to pay the rate lock fee.

Compare fixed rate home loans

$
years
Name Product Interest Rate (p.a.) Comp. Rate (p.a.) Fees Monthly Payment

HSBC Fixed Rate Home Loan Package P&IHome 2Y Fixed≥ 20% Deposit

HSBC Fixed Rate Home Loan Package
1.88%
2.86%
  • App: $0
  • Ongoing: $390 p.a.
$546.6
$3,288 refinance cashback offer
Lock in a low fixed rate for 2 years and buy your home with a 20% deposit. Eligible refinancers borrowing $250,000 or more can get a $3,288 cashback. Terms and conditions apply.

UBank UHomeLoan Fixed P&IHome 1Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
1.79%
2.32%
  • App: $0
  • Ongoing: $0 p.a.
$539.94
Fix your mortgage for 1 year with a very competitive rate and no ongoing fees.

Suncorp Home Package Plus Fixed P&IHome 2Y Fixed≥ 20% Deposit

Suncorp Home Package Plus Fixed
1.89%
2.85%
  • App: $0
  • Ongoing: $0 p.a.
$547.35
$3,000 refinance cash bonus
Lock in a low fixed rate for 2 years. Available with a 20% deposit. Eligible new borrowers can get the annual package fee reimbursed for the life of the loan. $3,000 refinance cash bonus for eligible borrowers. Other terms, conditions and eligibility criteria apply.

Greater Bank Great Rate Fixed Home Loan P&IHome 1Y Fixed≥ -10% Deposit

Greater Bank Great Rate Fixed Home Loan
1.69%
3.49%
  • App: $0
  • Ongoing: $0 p.a.
$532.6
Get one of the lowest rates on the market with this fixed rate mortgage. NSW, QLD and ACT residents only.

Homestar Star Classic Owner Occupied Fixed Special P&IHome 2Y Fixed≥ 20% Deposit

Homestar Star Classic Owner Occupied Fixed Special
1.79%
2.16%
  • App: $0
  • Ongoing: $395 p.a.
$539.94
Fix to a low rate for two years. Ongoing fee only applies while the rate is fixed. Requires a 20% deposit.

86 400 Own Home Loan Fixed P&IHome 1Y Fixed≥ 20% Deposit

86 400 Own Home Loan Fixed
1.84%
2.63%
  • App: $250
  • Ongoing: $250 p.a.
$543.64
$2,000 cashback offer
$2,000 cashback when borrowing $250,000 or more. Fix to this very competitive rate for one year. This loan requires a 20% deposit.

UBank UHomeLoan Fixed P&IHome 3Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
1.95%
2.27%
  • App: $0
  • Ongoing: $0 p.a.
$551.82
A competitive fixed rate loan with no ongoing fees. Requires a 20% deposit.

Australian Unity Health, Wealth and Happiness Package Fixed Home Loan P&IHome 3Y Fixed≥ 30% Deposit

Australian Unity Health, Wealth and Happiness Package Fixed Home Loan
1.99%
2.72%
  • App: $0
  • Ongoing: $399 p.a.
$554.81
Home buyers can lock in a low rate for 3 years. Requires a 30% deposit.

Well Home Loans Balanced Fixed Home Loan P&IHome 1Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
1.84%
2.01%
  • App: $250
  • Ongoing: $0 p.a.
$543.64
Owner occupiers can get a sharp fixed rate for the first year, plus an offset account. Available with a 10% deposit.

Greater Bank Great Rate Fixed Home Loan P&IHome 2Y Fixed≥ 20% Deposit

Greater Bank Great Rate Fixed Home Loan
1.79%
3.35%
  • App: $0
  • Ongoing: $0 p.a.
$539.94
A discounted 2 years fixed rate for home buyers. Available with just a 10% deposit. Guarantor option available. NSW, QLD and ACT residents only.

Macquarie Bank Basic Fixed Home Loan P&IHome 3Y Fixed≥ 30% Deposit

Macquarie Bank Basic Fixed Home Loan
2.09%
2.28%
  • App: $0
  • Ongoing: $0 p.a.
$562.33
Get a low interest rate and a mortgage with flexible, basic features. No application or ongoing fees. Requires a 30% deposit. Refinancers can switch with a convenient digital application.

Newcastle Permanent Building Society Premium Plus Package Fixed Rate P&IHome 3Y Fixed≥ 20% Deposit

Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.09%
3.58%
  • App: $0
  • Ongoing: $395 p.a.
$562.33
$2,000 cashback for eligible refinancers borrowing $250,000 or more.

Virgin Money Reward Me Fixed Rate Home Loan P&IHome 2Y Fixed≥ 20% Deposit

Virgin Money Reward Me Fixed Rate Home Loan
1.98%
2.66%
  • App: $300
  • Ongoing: $10 per month
$554.06
$3,000 refinance cashback.
Buy your home and lock in a low rate for the first two years. Get a $3,000 cashback when you switch to Virgin Money with a loan amount of $300,000 or more with an LVR up to 80%. You must apply by 29 August 2021 and settle by 26 November 2021.

Great Southern Bank Fixed Rate Home Loan P&IHome 2Y Fixed≥ 5% Deposit

Great Southern Bank Fixed Rate Home Loan
1.89%
4.04%
  • App: $600
  • Ongoing: $0 p.a.
$547.35
Pay no ongoing fees on a fixed rate home loan with flexible repayment options.

Well Home Loans Balanced Fixed Home Loan P&IHome 2Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
1.95%
2.02%
  • App: $250
  • Ongoing: $0 p.a.
$551.82
A low fixed mortgage with an optional 100% offset account. Not available for construction purposes.

AMP Bank Professional Package Fixed Loan P&IHome 2Y Fixed≥ 20% Deposit

AMP Bank Professional Package Fixed Loan
1.88%
2.84%
  • App: $0
  • Ongoing: $0 p.a.
$546.6
Get a low fixed rate package with no application or settlement fee. Available with a 20% deposit. Other fees and charges apply.

UBank UHomeLoan Fixed P&IHome 5Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.49%
2.42%
  • App: $0
  • Ongoing: $0 p.a.
$593.01
A five year fixed rate offer with no ongoing bank fees.

ME Flexible Home Loan Fixed with Members Package P&IHome 2Y Fixed≥ 20% Deposit

ME Flexible Home Loan Fixed with Members Package
1.89%
3.17%
  • App: $0
  • Ongoing: $395 p.a.
$547.35
$3,000 cashback when refinancing a loan of $250,000 or more. Other conditions apply. Lock in a competitive rate for owner occupiers for two years. Comes with a 100% offset account.

St.George Fixed Rate Advantage Package P&IHome 2Y Fixed≥ 20% Deposit

St.George Fixed Rate Advantage Package
1.94%
3.40%
  • App: $0
  • Ongoing: $395 p.a.
$551.07
$3,000 refinance cashback
Borrowers with 20% deposits or equity can get this competitive fixed rate loan. Refinancers borrowing $250,000 or more can get a $3,000 cashback (Other terms, conditions and exclusions apply). Refinancers Only.

Well Home Loans Balanced Fixed Home Loan P&IInvestment 2Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
2.14%
2.32%
  • App: $250
  • Ongoing: $0 p.a.
$566.11
A 2 year investor rate with principal and interest repayments. Optional offset account with a $10 monthly fee. Not available for construction purposes.

IMB Fixed Rate Home Loan P&IHome 1Y Fixed≥ 5% Deposit

IMB Fixed Rate Home Loan
2.19%
2.98%
  • App: $449
  • Ongoing: $6 per month
$569.91
Lock in a rate for one year and get the ability to make additional repayments for 12 months without penalty. Face-to-face consultations available for NSW and ACT customers. Available with a 5% deposit.

UBank UHomeLoan Fixed P&IInvestment 1Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.14%
2.71%
  • App: $0
  • Ongoing: $0 p.a.
$566.11
Investors can enjoy flexible repayments and an easy application process with this pioneering online lender.

Bank of Melbourne Advantage Package Fixed Home Loan P&IHome 2Y Fixed≥ 20% Deposit

Bank of Melbourne Advantage Package Fixed Home Loan
1.94%
3.40%
  • App: $0
  • Ongoing: $395 p.a.
$551.07
$3,000 refinance cashback
Get a competitive home loan rate for two years. Requires at least a 20% deposit. Refinancers borrowing $250,000 or more can get a $3,000 cashback (Other terms, conditions and exclusions apply). Refinancers Only.

IMB Fixed Rate Home Loan P&IHome 3Y Fixed≥ 5% Deposit

IMB Fixed Rate Home Loan
1.97%
2.81%
  • App: $449
  • Ongoing: $6 per month
$553.31
NSW and ACT customers only. 3 years fixed interest terms and free access to redraw facility online. Available with a 10% deposit.

Well Home Loans Balanced Fixed Home Loan P&IHome 3Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
2.14%
2.06%
  • App: $250
  • Ongoing: $0 p.a.
$566.11
A low 3 year fixed rate for home buyers. Add a 100% offset account with a $10 monthly fee. Not available for construction purposes.

Newcastle Permanent Building Society Premium Plus Package Fixed Rate P&IHome 1Y Fixed≥ 5% Deposit

Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.19%
3.83%
  • App: $0
  • Ongoing: $395 p.a.
$569.91
$2,000 refinance cashback
Enjoy a competitive rate with no application fee for this package loan. $2,000 cashback for eligible refinancers borrowing $250,000 or more.

UBank UHomeLoan Fixed IOHome 1Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.14%
2.35%
  • App: $0
  • Ongoing: $0 p.a.
$566.11
A one year fixed rate offer with no ongoing bank fees.

Macquarie Bank Basic Fixed Home Loan P&IHome 3Y Fixed≥ 20% Deposit

Macquarie Bank Basic Fixed Home Loan
2.19%
2.34%
  • App: $0
  • Ongoing: $0 p.a.
$569.91
Borrow up to $5,000,000 with this basic 3 years fixed rate home loan. Refinancers can switch with a convenient digital application.

Well Home Loans Balanced Fixed Home Loan P&IInvestment 3Y Fixed≥ 10% Deposit

Well Home Loans Balanced Fixed Home Loan
2.34%
2.36%
  • App: $250
  • Ongoing: $0 p.a.
$581.39
A competitive 3 year investor rate with principal and interest repayments. Optional offset account with a $10 monthly fee. Not available for construction purposes.

UBank UHomeLoan Fixed IOInvestment 3Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.24%
2.64%
  • App: $0
  • Ongoing: $0 p.a.
$573.72
Pay no ongoing fees on this investment loan fixed for 3 years.

Newcastle Permanent Building Society Real Deal Home Loan P&IHome≥ 20% Deposit

Newcastle Permanent Building Society Real Deal Home Loan
2.59%
2.63%
  • App: $595
  • Ongoing: $0 p.a.
$600.83
$2,000 refinance cashback
$2,000 cashback for eligible refinancers borrowing $250,000 or more.

IMB Fixed Rate Home Loan P&IInvestment 3Y Fixed≥ 10% Deposit

IMB Fixed Rate Home Loan
2.35%
3.33%
  • App: $449
  • Ongoing: $6 per month
$582.16
NSW and ACT customers only. A 3 years fixed rate investor which allows extra repayments to be made.

Newcastle Permanent Building Society Premium Plus Package Fixed Rate P&IHome 3Y Fixed≥ 5% Deposit

Newcastle Permanent Building Society  Premium Plus Package Fixed Rate
2.39%
3.66%
  • App: $0
  • Ongoing: $395 p.a.
$585.25
$2,000 refinance cashback
A two year fixed rate home loan with no application fees. $2,000 cashback for eligible refinancers borrowing $250,000 or more.

Heritage Bank Fixed Rate Home Loan P&IHome 2Y Fixed≥ 5% Deposit

Heritage Bank Fixed Rate Home Loan
2.19%
4.23%
  • App: $600
  • Ongoing: $8 per month
$569.91
Get a fixed rate for two years and borrow up to 95%.

UBank UHomeLoan Fixed P&IInvestment 3Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.09%
2.60%
  • App: $0
  • Ongoing: $0 p.a.
$562.33
Pay no ongoing fees on this competitive investment loan and fix your rate for 3 years.

IMB Fixed Rate Home Loan P&IHome 2Y Fixed≥ 5% Deposit

IMB Fixed Rate Home Loan
1.97%
2.88%
  • App: $449
  • Ongoing: $6 per month
$553.31
NSW and ACT customers only. Lock in a low fixed rate for two years. Available with a 5% deposit.

Newcastle Permanent Building Society Fixed Rate Home Loan P&IHome 2Y Fixed≥ 5% Deposit

Newcastle Permanent Building Society Fixed Rate Home Loan
2.29%
3.94%
  • App: $0
  • Ongoing: $0 p.a.
$577.55
$2,000 refinance cashback
Borrow up to 95% LVR of the value of the property you're buying and pay no ongoing fees. $2,000 cashback for eligible refinancers borrowing $250,000 or more.

UBank UHomeLoan Fixed IOHome 3Y Fixed≥ 20% Deposit

UBank UHomeLoan Fixed
2.09%
2.30%
  • App: $0
  • Ongoing: $0 p.a.
$562.33
A competitive 3 year fixed rate with no ongoing bank fees.

Heritage Bank Advantage Package Fixed P&IHome 1Y Fixed≥ 5% Deposit

Heritage Bank Advantage Package Fixed
2.39%
3.15%
  • App: $0
  • Ongoing: $350 p.a.
$585.25
Get a partial offset account and flexible repayments with this package loan.

86 400 Own Home Loan Fixed P&IHome 2Y Fixed≥ 20% Deposit

86 400 Own Home Loan Fixed
1.89%
2.59%
  • App: $250
  • Ongoing: $250 p.a.
$547.35
$2,000 cashback offer
$2,000 cashback when borrowing $250,000 or more. Get a low fixed rate for the first two years of your loan. Split and redraw facilities available. Requires a 20% deposit.

St.George Fixed Rate Advantage Package P&IInvestment 2Y Fixed≥ 20% Deposit

St.George Fixed Rate Advantage Package
2.24%
3.89%
  • App: $0
  • Ongoing: $395 p.a.
$573.72
$3,000 refinance cashback.
Investors can lock in a competitive rate for two years with this package loan. You will need at least a 20% deposit. Refinancers borrowing $250,000 or more can get a $3,000 cashback (Other terms, conditions and exclusions apply). Refinancers Only.
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2 Responses

    Default Gravatar
    PeterFebruary 20, 2018

    Do I need to pay rate lock if it goes over 90 days and I am unable to settle the property?

      Avatarfinder Customer Care
      MayMarch 12, 2018Staff

      Hi Peter,

      Thanks for your question.

      Locking your home loan interest rate usually comes with a fee. So if you’ve applied for it, yes, you still have to pay the fee even when you’re unable to settle your loan/it goes over 90 days. Contacting your lender directly is also best so they may be able to advise as to how much and when would the fee be charged.

      Cheers,
      May

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