For homebuyers who are closing on a new home right now, today's record-low mortgage rates couldn't be more welcomed. But for people who buy new construction today, and then must wait six, 12 or even 18 months for their home or condominium to be built, there is no guarantee that these low rates will be available down the road.

However, homebuyers at One One One Morgan, a new-construction loft condominium building in the West Loop, now have some assurance.

The building's developer, Evanston-based Winthrop Properties, in conjunction with MidAmerica Bank, is offering a New Construction Interest Rate Lock Program that caps interest rates for as long as 18 months. The program is free.

One One One Morgan offers 166 new loft-style condominiums in a nine-story building at Morgan and Adams streets. Floor plans include one to two bedrooms plus den, one to two baths and 680 to 1,535 square feet. A three-bedroom, 2,376-square-foot duplex penthouse is also available. Base prices range from $180,900 to $426,000, and the penthouse is priced at $726,000. Deeded, indoor parking is $25,000 per space.

According to Bob Horner, co-principal of Winthrop Properties, the rate lock protects homebuyers against volatility in the mortgage market and gives them the confidence they need to move forward with a new-home purchase now.

"No one really knows where mortgage rates will be in 18 months," Horner said. "If you look back 18 months, rates were about 2 percentage points higher than they are today. Now, economists are predicting a recovery in 2002, and rates could go up again. That's the dilemma new-construction buyers face, but this program offers protection."

The program features a guaranteed interest rate lock for 540 days. Initially, buyers lock in a rate, which floats (goes up or down) as the market dictates. However MidAmerica Bank places a cap of 1.5 percent on this rate, so that it can go no higher than the initial interest rate plus the cap amount. Once the buyer is within 30 days of closing, he or she relocks the interest rate.

While the program caps rates on the high end, it does not place a "floor" under rates if they go down. Therefore, if interest rates have decreased during the lock period, the homebuyer can take advantage of those new lower rates.

For example, if the current interest rate on a three-year adjustable rate mortgage (ARM) is 5.5 percent, MidAmerica guarantees that the homebuyer will receive a rate no higher than 7 percent, regardless of what rates are in 18 months. If, when it's time to relock, the rate on a 3-year ARM has gone up to 8 percent, the homebuyer still receives the guaranteed rate of 7 percent.

However, if the current interest rate on the three-year ARM is only 6.5 percent, 6 percent or even 5 percent, the buyer will receive this lower rate.

Buyers must put up 1 percent of the loan amount as an interest rate lock deposit. This deposit is refunded at closing. The program is available on all MidAmerica conventional loan products.

"It's very unusual for a lender to offer an 18-month lock. The standard rate lock for new construction is 60 days," said Steve Stapleton, vice president of loan production for MidAmerica Bank in Naperville.

"If rates rise 2 percent or more in the next 18 months, which history has shown is possible, buyers can get hit with a monthly payment that's several hundred dollars more than they anticipated," Stapleton noted. "One One One Morgan allows homebuyers to protect their monthly payment, and that's a big advantage for people looking for new construction in the West Loop."

Winthrop Properties broke ground at One One One Morgan in October 2001. The building is 60 percent sold, but still has a selection of more than 40 floor plans.

Standard features include private balconies or terraces, 10-foot ceilings, hardwood flooring in living areas and kitchens, carpeting in bedrooms, ventless gas fireplaces, individual heat and air conditioning, and track lighting.

Kitchens have 42-inch upper cabinets, Italian granite countertops, a 21-cubic-foot refrigerator, self-cleaning gas range, microwave and dishwasher.

Baths have ceramic tile flooring, tub and shower surrounds, full-width vanity mirrors, single-lever chrome faucets, and 5-foot soaking tubs in master baths.

Building amenities include a 24-hour doorman, individual unit storage, a marble-tiled lobby, high-speed elevators, and a high-rise fire protection system.

The sales center for One One One Morgan is located at the Southeast corner of Morgan and Jackson, two blocks west of Halsted. It features a decorated kitchen/living room vignette and scale model of the building.

To reach the sales center, take Interstate 90/94 to Adams Street, go west on Adams to Morgan, turn left on Morgan and continue south for one block. Sales hours are from 11 a.m. to 6 p.m. daily. Fore more information, call (312) 421-0111 or log onto www.111morgan.com.

Winthrop Properties is a joint enterprise of developers Bob Horner and Ibrahim Shihadeh. Horner and Shihadeh share more than 40 years of real estate experience, during which time they have built and sold more than 5,000 homes.

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