A mortgage rate lock is a written agreement from your lender that guarantees you a specific interest rate for a set period. This protects you from market increases while your loan application is being processed, typically lasting between 30 and 60 days.

No, the Federal Reserve does not set mortgage rates directly. They influence short-term interest rates through the federal funds rate, which affects the overall cost of borrowing and bond market yields, eventually impacting the rates lenders offer to consumers.

You should consider refinancing if the current market rate is at least 0.5% to 1% lower than your existing rate. Calculate your break-even point by dividing your total closing costs by your monthly savings to ensure you will stay in the home long enough to recoup the expenses.

Lenders use your credit score as a primary indicator of your likelihood to repay the loan. A higher credit score signals lower risk, which allows lenders to offer you more competitive interest rates compared to borrowers with lower scores.

No, inflation does not directly determine your rate, but it is a primary influence on the bond market. When inflation is high, investors require higher yields on mortgage-backed securities, which leads lenders to increase the interest rates offered to borrowers.