What is a "rate lock period"?
Lock It In
A rate "lock" or "commitment" is a promise from the lender to lock in a specific interest rate and a specific number of points for you for a certain period of time while your application is processed. This saves you from working through your whole application process and learning at the end that your interest rate has gone up.
Rate lock periods can vary in length, anywhere from 15 to 60 days, with the longer ones usually costing more. A lending institution will agree to freeze an interest rate and points for a longer span of time, like sixty days, but in exchange, the rate (and sometimes points) will be higher than with a rate lock of fewer days.
Additional Ways to Save on Interest
In addition to going with a shorter rate lock period, there are more ways you can attain the best rate. A bigger down payment will get you a reduced interest rate, since you're starting out with a good deal of equity. You can pay points to bring down your rate over the life of the loan, meaning you pay more up front. For many people, this is a good option..
Lear Financial Group LLC.
can answer questions about rate lock periods & many others. Call us at 214-869-7339.