In today’s rising rates environment it is understandable that people looking for financing are anxious about closing their loan before rates go up again. There are some lenders who allow rate locks on commercial real estate loans, but there are pros and cons to locking in your rate. Let’s discuss some of the pros and cons.

Fluctuating Rates

When you lock in a rate, you are protected against rates going up. However, there is a downside to this. When you lock in a rate, you will not get a lower rate if rates go down.

Timing

Rate locks are generally good for 60-90 days. However, if you lock too early and the loan closing gets pushed back, you run the risk of the rate lock expiring.

To Lock or Not to Lock?

Locking in a rate can ease the anxiety of rising interest rates. Be sure to ask the lender if they require a rate lock deposit. This could range anywhere from 1%-2% of the loan amount and is refundable at closing. There are circumstances where the lender could keep the rate lock deposit as a penalty so be sure to ask about this as well.

Looking To Get Started?

Simple Commercial Capital is here to help you navigate all of the CRE mortgage options available. Look through the loan programs found at the top of our page. Each program has a brief description and loan parameters. If one of the loan programs fits your needs click the Apply Now button to start the application process or call us at 1-866-554-1120 to discuss your options in more detail. Our goal is to make this process as simple as possible for you.