Getting a Low Interest Rate

Locking in your Interest Rate

A rate "lock" or "commitment" is a lender's promise to hold a certain interest rate and a particular number of points for you for a specified period while your application is processed. This ensures that your interest rate cannot grow as you are working through the application process.

Rate lock periods can vary in length, anywhere from fifteen to sixty days, with the longer period generally costing more. You can get a longer period for your lock, but in making this choice, will probably have a higher rate than you would with a shorter rate lock period

Other Interest Saving Strategies

In addition to opting for a shorter lock period, there are other ways you may be able to score the best rate. A bigger down payment will get you a reduced interest rate, since you will have more equity from the beginning. You can pay points to bring down your interest rate for the term of the loan, meaning you pay more initially. One strategy that makes financial sense for many people is to pay points to improve the interest rate over the life of the loan. You'll pay more up front, but you will save money in the long run.

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