Getting a Low Interest Rate

Lock It In

When you are offered a "rate lock" from your lender, it means that you are guaranteed to keep a specific interest rate over a determined period while you work on your application process. This ensures that your interest rate won't go up during the application process.

Rate lock periods can vary in length, between 15 to 60 days, with the longer period usually costing more. The lending institution will agree to hold 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 that of a rate lock of a shorter period.

Other Interest Saving Strategies

There are more ways to get a good rate, in addition to opting for a shorter rate lock period. A bigger down payment will result in a better interest rate, since you will be starting out with more equity. You can pay points to lower your rate for the life of the loan, meaning you pay more initially. One strategy that is a good option for some is to pay points to improve the interest rate over the term of the loan. You will pay more initially, but you'll save money in the end.

ADVISORY MORTGAGE can walk you through the pitfalls of getting a mortgage. Call us at 8102292820.