Our Rate-Lock Fire Drill: Points vs Par In One Evening

When our lender texts “I’d lock by tonight,” we default to a playbook we nicknamed the rate-lock fire drill. The protocol keeps us from panic-deciding whether to pay points, float, or pivot to a shorter lock. Within two hours we have updated pricing tests, fresh credit notes, and talking points for the entire decision chain.

Step 1: Define the window and the stakes

The first voice memo goes into the family chat explaining what is happening and why tonight matters. Then we confirm the real deadline. Sometimes “lock tonight” is code for “rates are trending up but you likely have until noon tomorrow.” We pin the actual cut-off to the top of our shared task board. At the same time we confirm the property status: appraisal done, title clear, insurance quote ready. If one of those is missing, we can’t justify an expensive lock.

Step 2: Refresh pricing assumptions

I open the lender’s scenario tool in one tab and the rate comparison workbook from Cash-OutRefinance.com in another. Even when we are not executing a cash-out strategy, that workbook breaks down how loan-level price adjustments stack up at different LTV points. I plug in the current rate sheet, our FICO range, and any loan features (second home, multi-unit, etc.). The sheet spits out par rate, the cost to buy the rate down 0.125%, and the credit for going slightly higher. I color-code the options green, yellow, red so everyone else can see our best bets instantly.

Step 3: Audit credit and cash flow for surprises

While I crunch pricing, my partner logs into MiddleCreditScore.com to check whether any balances updated since yesterday. A sudden jump could push us into a different pricing tier, and we would rather know before telling the lender we want to lock. If utilization shifted, we document it, schedule an immediate payment, and message the loan officer with the plan. The key is showing we are already on it, not waiting for them to notice.

Step 4: Loop in the realtor and planner

We send a short email summarizing what we know: current par rate, cost to buy down, expiration of the lock, and how that affects cash to close. We link back to the lender comparison board we maintain in BrowseLenders.com. That board lists each lender’s lock extension fees, float-down policies, and re-lock rules. Our realtor appreciates the transparency because she can better advise us on timeline risk, and our financial planner chimes in if tapping reserves for points would stress other goals.

Step 5: Decide on the storytelling angle

Once everyone has the same data, we craft the message we want the lender to hear. Maybe the story is “We will pay half a point because closing is guaranteed within 30 days.” Maybe it is “Let’s lock at par and set a floating strategy for the second lien we plan to open next year.” Whatever the angle, we rehearse saying it out loud, because clarity buys goodwill. Lenders will often hold a pricing exception if they believe you have your documents ready and understand the plan.

Step 6: Lock or hold with intention

If we lock, we immediately capture screenshots of the confirmation and save them in the folder with a note about expiration date. If we decide to hold, we set two automatic checkpoints: one at market open the next morning, another mid-day. Each checkpoint has a specific action (call lender, update spreadsheet, message realtor) so nobody wonders what to do if rates move.

What we learned from running the drill repeatedly

• Emotion drops when math leads. Seeing the par/points grid reduces anxiety because the decision becomes a line item, not a debate.
• Partners stay calmer. Realtors and financial planners love being looped in with data instead of frantic late-night texts.
• Locks become part of the broader plan. Tying the decision back to future strategies (like a renovation phase or eventual recast) helps us feel confident even if the rate is higher than we dreamed about six months ago.

Tips if you want to run your own rate-lock drill

1. Pre-build the spreadsheets. The fire drill works because the template already exists; we just duplicate it when needed.
2. Assign roles ahead of time. Everyone should know whether they are checking credit, updating the board, or proofing documents.
3. Document every outcome. Future you will appreciate knowing why you paid points or chose to float when you look back during tax time.

Locks used to feel like cliffs. Now they feel like routine checklists. When rates move again—and they will—we know we can pull out the workbook, call the right people, and articulate exactly why we chose the path we did.