If the market is declining, you may decide not to ask for a lock-in. Unforeseen events sometimes turn a loan officer from a hero into a bum overnight. Economic earthquakes elsewhere in the world while Americans are sleeping can and have caused us to awake to a completely different financial landscape in the morning. Faced with a rapid rate increase, lenders may be swamped with phone calls. On the other hand, someone who has locked in a loan may see rates plunge day after day.
Some lenders feel however that the benefits of such an option are limited.
She added that very few mortgage bankers now offer the float down option, and that the few institutional lenders who do, have rates that are often slightly higher than the market. If you want the float down option, be sure to ask your lender if there is a charge for this option and also what the interest rate is. If you chase the market, you may well end up getting hammered. Everyone needs to play their own game, make their own decisions. You need to decide if mortgage rates are changing fast enough to warrant a lock-in rate or not.