Getting a Low Interest Rate
Locking in your Interest Rate
A rate "lock" or "commitment" is a lender's promise to freeze a specific interest rate and a certain number of points for you for a specified period while your application is processed. This protects you from getting through your entire application process and finding out at the end that your interest rate has risen higher.
Rate lock periods can be various lengths of time, anywhere from 15 to 60 days, with the longer ones typically costing more. You can get a longer period for your lock, but in making this choice, will likely have a higher interest rate than you would have with a shorter rate lock span of time
Additional Ways to Save on Interest
There are other ways to get a reduced rate, in addition to opting for a shorter rate lock period. A larger down payment will give you a better interest rate, because you are starting out with more equity. You may opt to pay points to reduce your rate over the loan term, meaning you pay more initially. One strategy that is a good option for some is to pay points to bring the rate down over the term of the loan. You'll pay more up front, but you will come out ahead in the end.
Lear Financial Group LLC.
can walk you through the pitfalls of getting a mortgage. Call us at 214-869-7339.