What does an interest-rate lock cover?

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"I locked my 30-year fixed-rate mortgage at 5.5 percent and 1 point, but at closing I was dunned for $2,800 in lender fees of various types that had never appeared on the Good Faith Estimate. Why didn't the lock protect me against that?" A lock is designed to protect borrowers against a rise in price between the lock date and closing, but the protection is often inadequate or fails altogether. You just discovered (the hard way) one of the reasons. In locks covering fixed-rate mortgages (FRMs), most lenders include only the interest rate and points. (Points are an upfront charge expressed as a percentage of the loan amount.) They leave their fixed-dollar fees out of the lock. Then, if the market goes against them–for example, say they have to close a 5.5 percent mortgage in a 6 percent market–they can cover at least some of their loss by jacking up their fees. Based on past experience, the paragraph above is going to elicit angry denials of the "we are a reputable firm ...