Rates Jumped Mid-Deal? Protecting Your Boston Home Purchase

What happens if mortgage rates rise after your offer is accepted in Massachusetts?

If your rate is locked, nothing changes, as long as you close before the lock expires.  If you're floating, your payment rises and your contract usually doesn't protect you, because the standard Massachusetts mortgage contingency is tied to getting a loan at prevailing rates, not the rate you hoped for.  Your real protections are the rate lock, the mortgage commitment date in your Purchase and Sale Agreement, and written action through your attorney before that date passes — miss it, and your deposit (often 5% of the price) can be at risk.

By Tyler Smith | Beacon & Bond Group | October 5, 2026

Mortgage rates didn't drift up this fall. They jumped.

Freddie Mac's 30-year average hit 7.28% on October 1, 2026 which is the highest since October 2023, up 25 basis points in a single week and the sixth straight weekly increase.  A year ago, the same loan averaged 6.34%.  The Boston Globe reported this week that the surge is adding roughly $1,000 a month to a typical Greater Boston purchase payment.

If you're shopping, that's a budgeting problem.  If you're already under agreement, OTP signed, P&S signed or about to be — it's a contract problem.  And that's the question I'm getting from buyers right now: "Rates went up after my offer was accepted.  Am I stuck?  Can I get out? Will I lose my deposit?"

Here's how it actually works in Massachusetts.

Your three protections: the lock, the commitment date, and your attorney

Massachusetts uses a two-step contract.  Your signed Offer to Purchase is binding, and the Purchase and Sale Agreement (usually signed 10–14 days later) sets the deadlines that matter for financing. 

Once you're under agreement, three things decide whether a rate spike hurts you.

1. Your rate lock

If you locked when you went under agreement, a rate jump after that date doesn't change your rate.  That's the whole point of the lock.

The risk is expiration. Most purchase locks run 30, 45, or 60 days, and Massachusetts closings commonly land 45–60 days after the offer.  If appraisal scheduling, a title issue, or a repair negotiation pushes your closing past the lock date, you'll typically face two options:

• Pay to extend.  Industry ranges run roughly 0.0625%–0.125% of the loan for 7 days, 0.125%–0.25% for 15 days, and 0.25%–0.50% for 30 days.  On a $960,000 loan, that's about $600–$1,200 for a week and $2,400–$4,800 for a month.
• Let it lapse and re-lock.  Many lenders reprice an expired lock at the worse of your original rate or today's market.  In this environment, that's almost always the expensive choice.

When rates have risen since you locked, an extension is nearly always worth it.  The fee is one-time.  A higher rate is for the life of the loan.

If the delay was your lender's fault, possilby due to the appraisal ordered late or your file stuck in underwriting, ask them to absorb the extension.  Lenders often will, but usually only when you can show a dated timeline.

If you're still floating: lock now unless you can comfortably absorb a higher payment.  Floating when rates have risen six weeks in a row is a bet, not a strategy.

2. Your mortgage commitment date

This is the date in your P&S by which your lender must issue a written loan commitment.  It's usually about 30 days after the P&S is signed (roughly 21–35 days after the offer), and it's the single most important deadline in your deal.

Here's what most buyers don't realize: the standard Massachusetts P&S forms tie the mortgage contingency to obtaining a loan at "prevailing rates, terms and conditions." That means:

• A higher rate, by itself, usually isn't an exit.  If your lender will still approve you at today's rate, the contingency has done its job — even if the payment is $500 more than you planned.
• A denial is.  If the higher rate pushes your debt-to-income ratio past your loan program's limit and the lender won't issue a commitment, the contingency protects you only if your attorney sends written notice before the commitment date.
• Silence is the danger.  If the commitment date passes without a commitment, a signed extension, or a written termination, your contingency can lapse.  Your deposit in Greater Boston, typically about 5% of the purchase price across the OTP and P&S can be at risk.

Your exact language matters.  Some P&S agreements specify a maximum interest rate or particular loan terms; many don't.  Have your attorney confirm what yours says today, not the week of the deadline.

3. Your attorney — in writing, before the deadline

Massachusetts is an attorney-closing state, and this is where that pays off.  Extensions and terminations happen attorney-to-attorney, in writing. A phone call between agents isn't an extension.

If your lender needs more time, your attorney should request a commitment-date extension from the seller's attorney before the deadline, ideally with a note from your lender explaining what's outstanding.  Sellers agree to short extensions often.  They don't have to, which is why you start the conversation early.

What a rate jump actually does to a Boston-area deal

Let's put real numbers on it.  Say you're buying a $1.2 million single-family in Newton or Needham with 20% down — a $960,000 loan.

That's about $500 a month more going from 6.5% to 7.28% before taxes and insurance.  If you're locked, you never see that number.  If you floated, it's real.

Now the deposit math.  On a $1.2 million purchase, a 5% deposit is $60,000.  That's what's on the line if you blow through your commitment date without a commitment, an extension, or a termination letter.

For most buyers I work with in this price range, the higher rate is uncomfortable but still approvable.  The bigger risk is the buyer who:

• Floated their rate expecting a dip
• Was approved close to their DTI ceiling
• Has a commitment date in the next one to two weeks

If that's you, call your lender today and ask one direct question: "At today's rate, do I still qualify — yes or no?"  Then call your attorney with the answer.

Your action list this week

1. Confirm your lock status and expiration date in writing from your lender.
2. Compare the lock date to your closing date.  If the gap is tight, price a 7- or 15-day extension now.
3. Find your mortgage commitment date in your P&S and put it on your calendar with a reminder five business days earlier.
4. Ask your lender whether your approval still holds at current pricing if you're floating.
5. Don't change anything financially — no new credit, no car loan, no furniture on a card.  Lenders re-verify credit and employment before funding, and a DTI that was fine at 6.5% may not survive new debt at 7.28%.
6. Ask about a seller-paid buydown if the payment jump is the problem.  With price cuts and concessions more common this fall, sellers are more open to a credit than they were in the spring.

That last point deserves a closer look. If the appraisal comes in low or the inspection turns up items to negotiate, a credit toward a temporary or permanent rate buydown can do more for your monthly payment than a small price reduction.  This is exactly the kind of trade-off I run side-by-side with clients before we go back to the seller.

If you're the seller

A rate spike affects you too.  Your buyer's financing just got harder.

• Ask for a lock confirmation through your attorney once you're under agreement.  A locked buyer is a stronger buyer.
• Expect extension requests on the commitment date.  A short extension with a lender letter explaining what's outstanding is usually reasonable.  An open-ended request is not.
• Know your liquidated damages clause.  The standard forms typically let you keep the deposit as your remedy if a buyer defaults after contingencies lapse, but only on the terms written into your P&S.
• Keep backup interest warm.  Nationally, about one in seven pending sales were cancelled this summer.  You don't need to panic.  You need a plan B.

If you're also buying your next home, the timing pressure doubles.  

Frequently Asked Questions

Can I back out of buying a house in Massachusetts because interest rates went up?

Usually not on that basis alone.  Standard Massachusetts P&S forms tie the mortgage contingency to a loan at prevailing rates, so if your lender still approves you at the higher rate, the contingency is satisfied.  If the higher rate causes a loan denial, you can typically terminate and recover your deposit as long as your attorney gives written notice before the mortgage commitment date.

What is the mortgage commitment date in a Massachusetts purchase?

It's the deadline in your Purchase and Sale Agreement by which your lender must issue a written loan commitment, usually about 30 days after the P&S is signed.  Before that date, you can extend it (with the seller's written agreement) or terminate under the mortgage contingency.  After it passes without action, your deposit can be at risk.

What happens if my rate lock expires before closing?

You'll usually either pay an extension fee which is roughly 0.0625%–0.50% of the loan depending on length, or re-lock at current pricing, which many lenders set at the worse of your original rate or today's rate.  If the delay was caused by your lender, ask them to cover the extension and bring a dated timeline.

How much deposit do Massachusetts buyers risk if a deal falls apart?

In Greater Boston, buyers commonly put down about $1,000+ with the Offer to Purchase and bring the total to about 5% at the P&S.  On a $1.2 million home, that's roughly $60,000.  Whether you get it back depends on whether you exited under a valid contingency, in writing, on time.

Should I lock my mortgage rate now or wait for rates to drop?

If you're under agreement and a higher payment would strain your budget or your approval, lock now.  Freddie Mac's average has risen six weeks in a row to 7.28%, and a float-down option, if your lender offers one, is the safer way to keep upside without carrying the downside.

Rates moving mid-deal is stressful, but it's manageable when you know your three dates — lock expiration, commitment date, and closing — and act on them in writing.  The buyers who get hurt are the ones who wait until the deadline to find out where they stand.

If you're under agreement in Boston, Brookline, Newton, Needham, Dedham, or Milton and want a second set of eyes on your timeline, I'm happy to walk through it with you.  Reach out anytime at tyler@beaconandbondgroup.com.

About Tyler Smith | Beacon & Bond Group Tyler Smith is the founder of Beacon & Bond Group and a licensed REALTOR® with Real Broker MA, LLC, specializing in Boston, Brookline, Newton, Needham, Dedham, and Milton. Since 2020, he has represented more than 90 clients across $85 million in transactions, with hands-on experience as both a listing agent and a real estate investor.  Connect with Tyler at beaconandbondgroup.com.

This article is general information, not legal or lending advice. Your Purchase and Sale Agreement and loan documents control — review your specific terms with your real estate attorney and lender.