Locking in your Interest Rate
A rate “lock” or “commitment” is a promise from the lender to hold a particular interest rate and a certain number of points for you for a specified period of time during your application process. This prevents you from getting through your entire application process and finding out at the end that your interest rate has gone up.
Rate lock periods can be various lengths of time, between 15 to 60 days, with the longer ones usually costing more. You can get a longer period for your lock, but in choosing this option, will most likely have a higher interest rate than you would have with a shorter period
Other Interest Saving Strategies
In addition to going with a shorter lock period, there are several ways you are able to get the best rate. The larger down payment you can pay, the better the rate will be, because you will be starting with more equity. You could choose to pay points to improve your interest rate for the loan term, meaning you pay more up front. To many people, this makes sense and is a good deal..
Family Finance Mortgage can walk you through the pitfalls of getting a mortgage. Call us: 6362824900.