Well...in evaluating this decision for myself over the years I've been a home-owner, I've always reviewed how important rate certainty (and thus fixed payments) were for me -- because that's what you are essentially buying when you lock in, and there is (as you've noticed) a premium to be paid for avoiding insurance rate risk.
In your shoes I would look at your capacity to tolerate fluctuations. How stable is your income? How correlated to the broader economy is your job? And also: how affordable is your mortgage payment under a couple of different interest rate scenarios?
When I first bought a home (this is back in 1996) I did some research at that time on the long-term effects of locking in vs. keeping a six-month open mortgage. The data at that time showed that over a fairly long period (10+ years) NOT locking in saved you more in interest payments than locking in would have (irrespective of the rates, if that makes sense to you). I would hazard a guess that's still true, although I am not going to crunch the numbers.
In your shoes I would look at your capacity to tolerate fluctuations. How stable is your income? How correlated to the broader economy is your job? And also: how affordable is your mortgage payment under a couple of different interest rate scenarios?
When I first bought a home (this is back in 1996) I did some research at that time on the long-term effects of locking in vs. keeping a six-month open mortgage. The data at that time showed that over a fairly long period (10+ years) NOT locking in saved you more in interest payments than locking in would have (irrespective of the rates, if that makes sense to you). I would hazard a guess that's still true, although I am not going to crunch the numbers.