Lock-in period

Lock-in period,

Definition of Lock-in period:

  1. Period during which a loan cannot be paid-off earlier than scheduled without incurring penalties. Its objective is to generate a certain minimum return on the sums advanced that covers the lenders lending and loan administration expenses.

  2. Period for which a lender agrees to hold steady the agreed upon interest rate on the loan irrespective of the market rate. Also called lockup period.

Meaning of Lock-in period & Lock-in period Definition