What is a "rate lock period"?

Locking in your Interest Rate

A rate "lock" or "commitment" is a promise from the lender to set a particular interest rate and a specific number of points for you for a certain period of time during your application process. This means your interest rate won't rise during the application process.

Rate lock periods can vary in length, anywhere from fifteen to sixty days, with the longer ones usually costing more. You can get a longer period for your lock, but in doing so, will most likely have a higher rate than you would with a shorter rate lock span of time

More Ways to Get a Great Interest Rate

In addition to going with a shorter lock period, there are more ways you may be able to get the lowest rate. The larger the down payment, the lower the rate will be, because you will have more equity from the beginning. You might opt to pay points to reduce your interest rate over the loan term, meaning you pay more up front. One strategy that makes financial sense for many people is to pay points to improve the interest rate over the term of the loan. You will pay more initially, but you will save money, especially if you keep the loan for the full term.

24-7 Mortgage Loans can walk you through the pitfalls of getting a mortgage. Give us a call: 5102009714.

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