Getting a Low Interest Rate

Freezing the Rate

A rate "lock" or "commitment" is a promise from the lender to lock in a specific interest rate and a specific number of points for you for a specified period while your application is processed. This keeps you from working through your entire application process and learning at the end that the interest rate has gone up.

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

More Ways to Get a Great Interest Rate

There are other ways to get a good rate, besides going with a shorter rate lock period. The more the down payment, the lower your interest rate will be, since you will be entering the loan with more equity. You can pay points to lower your rate over the loan term, meaning you pay more up front. To a lot of people, this makes financial sense..

ADVISORY MORTGAGE can answer questions about rate lock periods & many others. Give us a call at 8102292820.