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

What is a Rate Lock?

A rate "lock" or "commitment" is a promise from the lender to lock in a particular interest rate and a particular number of points for you for a specified period while your application is processed. This saves you from going through your whole application process and learning at the end that the interest rate has risen higher.

Rate lock periods can vary in length, anywhere from 15 to 60 days, with the longer ones generally costing more. You can get a longer period for your lock, but in choosing this option, will likely have a higher rate than you would with a shorter rate lock period

Other Interest Saving Strategies

There are more ways to get a lower rate, besides choosing a shorter rate lock period. A larger down payment will result in a better interest rate, because you're starting out with a good deal of equity. You can pay points to reduce your interest rate for the loan term, meaning you pay more up front. One strategy that is a good option for many people is to pay points to bring the rate down over the term of the loan. You'll pay more initially, but you will come out ahead, especially if you don't refinance early.

Executive Lending Group, LLC can answer questions about rate lock periods & many others. Call us at 8165258000.