What is a "rate lock period"?

Locking It In

A rate "lock" or "commitment" is a promise from the lender to hold a specific interest rate and a certain number of points for you for a certain period while your application is processed. This means your interest rate cannot grow during the application process.

Although there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are usually more expensive. The lender can agree to hold 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.

Additional Ways to Save on Interest

In addition to choosing a shorter lock period, there are other ways you can get the lowest rate. A larger down payment will get you a lower interest rate, because you're starting out 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..

1st Credential Mortgage Inc can answer questions about rate lock periods & many others. Call us: 2817780805.