Lock-In

In Jamaican real estate, a Lock-In is a provision in a mortgage or loan agreement that prevents the borrower from refinancing or paying off the loan early without incurring a penalty. This clause is included to ensure the lender receives the full expected interest income over the loan’s term. Lock-ins are typically used during periods of favorable interest rates to protect lenders from borrowers taking advantage of lower rates elsewhere. The lock-in period is defined at the time of loan agreement and usually lasts for a set number of years. Borrowers should be aware of this provision when securing a mortgage to avoid unexpected costs if they wish to refinance or pay off their loan early.