"Rate Lock" and other Ways to Get a Lower Interest Rate

Locking in your Interest Rate

When you're promised a "rate lock" from your lender, it means that you are guaranteed to keep a particular interest rate for a certain number of days for your application process. This keeps you from going through your entire application process and learning at the end that the interest rate has gotten higher.

Rate lock periods can vary in length, anywhere from 15 to 60 days, with the longer spans generally costing more. A lending institution can agree to lock in an interest rate and points for a longer span of time, like 60 days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.

More Ways to Get a Great Interest Rate

In addition to going with a shorter rate lock period, there are more ways you can get the best rate. The bigger 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 improve your rate for the term of the loan, meaning you pay more up front. For a lot of people, this is a good option..

Custom Lending Group can answer questions about rate lock periods & many others. Give us a call: 7072522700.

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