Getting a Low Interest Rate

Lock It In

A rate "lock" or "commitment" is a lender's promise to hold a particular interest rate and a certain number of points for you for a certain period of time during your application process. This means your interest rate won't grow while you are working through the application process.

While there might be a choice of rate lock periods (from 15 to 60 days), the longer spans are usually more expensive. A lending institution may agree to hold an interest rate and points for a longer span of time, say sixty days, but in exchange, the rate (and sometimes points) will be higher than with a rate lock of fewer days.

Other Interest Saving Strategies

In addition to choosing the shorter lock period, there are other ways you may be able to get the best rate. The bigger the down payment, the better your interest rate will be, since you will be starting with more equity. You could choose to pay points to reduce your rate over the life of the loan, meaning you pay more initially. One strategy that makes financial sense for some is to pay points to bring the rate down over the life of the loan. You'll pay more up front, but you will come out ahead in the end.

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