"Rate Lock" and other Ways to Get a Lower Interest Rate
Lock It In
When you're promised a "rate lock" from the lender, it means that you are guaranteed to keep a certain interest rate over a certain number of days while you work on your application process. This prevents you from getting through your entire application process and learning at the end that the interest rate has risen higher.
Although there are several lengths of rate lock periods (from 15 to 60 days), the extended spans are usually more expensive. A lender will agree to lock in an interest rate and points for a longer period, say sixty days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.
More Ways to Save on Interest
There are other ways to get a better rate, besides opting for a shorter rate lock period. The more the down payment, the smaller the interest rate will be, since you will have more equity from the beginning. You might choose to pay points to improve your rate for the loan term, meaning you pay more up front. To a lot of people, this is a good option..
Debbie Oliver NMLS License #248252, America's First Choice Mortgage, NMLS License #279234 can walk you through the pitfalls of getting a mortgage. Give us a call at 2146635355.