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Could you tell me which other lenders are offering 200 day + lock. With interest rates changing so fast, I get a hard time with lenders letting to lock rates even for 60 days.

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Kind of funny that 60 days is too long for a product that lasts 30 years.

My guess is local banks and credit unions are the most likely source. They keep the loans on their portfolio instead of selling them like the mortgage companies.

A 200 day lock is a call option on a loan, the price of the option changes all the time. What you're saying is that local banks/CUs would offer such an option for free. Someone has to pay for the option - in the scenario you describe, the bank/CU would pay for it by losing liquidity of its assets, then having to mark them down.

Rate locks are backed by rate swaps. The cost of purchasing a rate swap ultimately comes out of your pocket in the form of additional rate on the loan (the lender can add overhead of course). The cost of rate swaps has doubled in the past 3 months and quadrupled in the past 18 months. I believe it's currently around 3% on 10 year loans, so a 60 day lock on a $500K 10Y mortgage would cost about $2500 while a 200 day lock would cost over $8000.

Who the hell is buying 10Y mortgages?

Feel free to add an extra percentage point for a 10Y/30Y swap.

One interesting hypothesis is that the focus on fixed-rate 30Y mortgages is fundamentally destabilizing for the US and world economy, because the stability and optionality of 30Y mortgages is paid for by added volatility of the 10Y debt market through those same swaps. Per this theory, US 30Y fixed-rate mortgages are effectively subsidized by the rest of the world. https://byrnehobart.medium.com/the-30-year-mortgage-is-an-in...

Seems like most folks can barely avoid the monthly payment on a 30Y fixed; wouldn't 10Y being the norm just cause a lot of people to be unable to buy at all?

I don't know. The question is whether subsidizing 30Y mortgages (fannie mae/freddie mac/FHA/QE/standard terms enforced by law to enable refinancing, etc.) is the right policy in an open system where it has many major side effects, compared to other ways to adjust housing policy. For reference, Canada has no 30Y fixed mortgages - instead they have 5-10Y fixed terms and distinguish between prepayment for refinancing (exploiting the rate environment) vs. moving (the mortgage can be rolled into the new property). As a policy, this seems less likely to have destabilizing effects than what happens in the US (concentrating volatility by loading up the banks' balance sheets with trillions of refinanced debt at times of low interest rates for folks who happened to have the means and cash flow to refinance at the right time).

Rolling the mortgage into the new property seems interesting. From what I understand, this is very rare in US mortgages, right?

I do wonder, if we just had 10Y mortgages, would home prices just crash? People won't buy what they can't afford (I mean, sure, they do to some extent, but not if their monthly payment would double), so sellers might just be forced to sell for less. The first "generation" of 10Y-only mortgages would be disastrous for current owners, as their existing 30Y mortgages would be underwater. Or maybe people just would stop moving...

I just glanced at the article you linked, and realized I'd read it back when it was posted, and agreed with its conclusions. I just don't know what the solution is.

Right, US mortgages are not portable.

Going back to the Canadian mortgages, they have terms of 5-10 years but they can be amortized over up to 25 years. So their standard practice is effectively a balloon payment of up to 80% that is expected to be refinanced at rates in effect at the end of the term. This still financializes housing over up to 25 years (similar to the US) but without subsidizing the interest rate optionality.

In the US, balloon payments are heavily discouraged by federal regulation on what kinds of mortgages can be financially supported by the government.

Ah, that makes a lot of sense. So the monthly payments are still affordable, and people mostly avoid the balloon-like payments by refinancing.

The downside (for the borrower, anyway), of course, is that if you do live in the same house long-term, you'll have more-frequent forced refinancing events that might result in an unfavorable interest rate. But that otherwise seems pretty reasonable, and arguably (as the article you linked points out), the ability to "lock" your interest rate for such a long time isn't great for the market.

> I do wonder, if we just had 10Y mortgages, would home prices just crash?

I suspect home prices won't fall by as much as you think they will. I suspect institutional investors will become major buyers and lease out those units; which would crash homeownership - at least in the popular metros

Same. I think the days of 2+ month locks are over. I've talked to half a dozen lenders since the new year and the longest lock they'd give without massive upfront fees was 60 days.

I got a 3 month lock from Chase this past October but it might be that things have changed since then.

Got 90 days from NASB - worth checking out.

We got a 90 day from Chase in February for nothing, all we had to do was ask for 90 instead of the 60 they wanted to give us, and after about 10 seconds of typing he said that was fine. I think we're a far cry away from "the days of 60+ day rate locks are over"

Interesting. I didn't talk to Chase specifically, because even as one of their better customers, the rate they offered was at least 0.5% higher than every other place, so I didn't even bother.

Not 200 days, but was able to get a 180 day lock in February. Of course, that was before the rates shot up, so my current rate is probably better than those with far better credit can get, just a couple of months later.

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