How long is a rate good for once you get a mortgage approval?

So you’ve accepted an offer on your house, but want to delay closing until you find a home to buy – but the buyer’s agent has told them that they may have to pay extra to hold their interest rate for longer than 45 days. Your situation is far from unique, and raises a key point that many buyers overlook when making an offer.


Sellers are naturally eager to know that their house is really sold. That’s why the typical agreement of sale used in this area requires the buyer to apply for a particular type of mortgage within a specific timeframe. For example, a buyer agrees to apply for a 30 year fixed mortgage at 4.5% to 6.5% interest within 10 days of the execution of the agreement. The mortgage commitment letter is due so many days after that.


But say a buyer has a home to sell, and their buyer needs to give notice on a lease, or to arrive on a certain date to start a job, timing the closing date can prove challenging. School schedules, lender requirements and construction delays can all impact the delicate balance. Think dominoes! Honestly, it’s amazing how many houses change hands so smoothly!


In the past, lenders were willing to lock rates for up to 60 days without extra fees. That was usually enough time to close the transaction. In your case, since you’re asking then to wait, you could pay to extend the commitment. The cost is usually a quarter of a point (0.25%), but make sure you know the cost before finalizing your offer.