Rate LockFinancial Dictionary -> Loans -> Rate Lock
Some lenders offer what is called a rate lock on variable interest rate loans. This is a temporary lock on the interest rate. In other words for a given period of time the interest rate will be fixed. This will usually occur when interest rates are most volatile. Usually this is only a short term agreement and the interest rate will eventually go back to be variable.
If a loan is already going by a fixed rate of interest the lender may still negotiate a rate lock at a different rate depending on how the market has changed since the rate was fixed in to place.
It is common for a lender to offer a rate lock for the first 30 to 60 days of a loan agreement as an incentive for the borrower to choose them over another lender. Loans are often marketed with rate locks to draw in potential customers.