When you're promised a "rate lock" from the lender, it means that you are guaranteed to get a particular interest rate for a certain number of days while you work on the application process. This keeps you from getting through your whole application process and finding out at the end that your interest rate has gone up.
Rate lock periods can vary in length, anywhere from fifteen to sixty days, with the longer spans usually costing more. You can get a longer period for your lock, but in choosing this option, will probably have a higher rate than you would with a shorter period
There are more ways to get a low rate, besides opting for a shorter rate lock period. The bigger down payment you pay, the smaller the rate will be, as you will be entering the loan with more equity. You may choose to pay points to improve your interest rate for the loan term, meaning you pay more initially. To many people, this is a good option..
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.