"Rate Lock" and other Ways to Get a Lower Interest Rate
Locking in your Interest Rate
A rate "lock" or "commitment" is a promise from the lender to hold a specific interest rate and a specific number of points for you for a specified period while your application is processed. This protects you from working through your entire application process and discovering at the end that your interest rate has gone up.
Although there are various lengths of rate lock periods (from 15 to 60 days), the extended spans are generally more expensive. You can get a longer period for your lock, but in choosing this option, will probably have a higher interest rate than you would with a shorter rate lock period
Other Interest Saving Strategies
There are more ways to get a reduced rate, besides opting for a shorter rate lock period. A bigger down payment will result in a reduced interest rate, because you'll have more equity at the start. You might choose to pay points to lower your rate over the term of the loan, meaning you pay more initially. For a lot of people, this makes financial sense..
Ward Kilduff Mortgage can walk you through the pitfalls of getting a mortgage. Call us at (860) 658-7100.
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