What is a "rate lock period"?

Locking It In

When you are offered a "rate lock" from the lender, it means that you are guaranteed to get a particular interest rate for a certain number of days while you work on your application process. This means your interest rate will not get higher during the application process.

Rate lock periods can vary in length, anywhere from fifteen to sixty days, with the longer period usually costing more. A lender will agree to freeze an interest rate and points for a longer period, like 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.

Other Ways to Save on Interest

In addition to going with the shorter rate lock period, there are more ways you can get the best rate. The bigger the down payment, the better your interest rate will be, since you will have more equity from the start. You might opt to pay points to bring down your rate over the loan term, meaning you pay more up front. For a lot of people, this makes sense and is a good deal..

Debbie Oliver NMLS License #248252, America's First Choice Mortgage, NMLS License #279234 can answer questions about rate lock periods and many others. Call us at 2146635355.