Finance
In Colorado, an 'interest rate lock' on a mortgage means:
AA. The lender can change the rate at any time before closing
BB. The lender commits to a specific interest rate for a defined period, protecting the borrower from rate increases during that time✓ Correct
CC. The borrower is locked in permanently and cannot refinance
DD. The rate is fixed only for the first year
Explanation
A rate lock is a lender's commitment to hold a specific interest rate (and usually points) for a defined lock period (typically 30-60 days), protecting the borrower from rising rates while the loan is being processed. If rates fall, the borrower is locked in at the higher rate unless the lock agreement allows for a 'float down' option.
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