[nostromo]

Yes you can refinance at a lower rate if/when rates drop.

You have to pay some money to do so, but it's insignificant compared to the cost of interest if it's over a percent lower or so.

There are usually no pre-payment penalties.

I imagine a lot of people buying houses right now are counting on mortgage rates dropping in the future.

[bushbaba]

*so long as your house appraised for high enough value to meet the debt to equity ratio. So if mortgage rates go down, but your home price crashes 10%, you’ll likely only be able to refinance by significantly paying down the mortgage balance.