Getting a Low Interest Rate
Locking in your Interest Rate
When you are promised a "rate lock" from a lender, it means that you are guaranteed to keep a certain interest rate for a determined period for the application process. This keeps you from getting through your entire application process and discovering at the end that the interest rate has gotten higher.
Rate lock periods can be various lengths of time, anywhere from fifteen to sixty days, with the longer period typically costing more. A lender may agree to hold an interest rate and points for a longer span of time, such as 60 days, but in exchange, the rate (and sometimes points) will be more than with a rate lock of a shorter period.
Other Interest Saving Strategies
In addition to opting for the shorter rate lock period, there are other ways you can attain the best rate. A bigger down payment will give you a reduced interest rate, since you will be starting out with a good deal of equity. You may choose to pay points to lower your rate for the life of the loan, meaning you pay more up front. For a lot of people, this is a good option..
Stepping Stone Mortgage can walk you through the pitfalls of getting a mortgage. Call us at 5416833300.