What is a "rate lock period"?
What is a Rate Lock?
When you're offered a "rate lock" from your 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 means your interest rate won't rise during the application process.
While there may be a choice of rate lock periods (from 15 to 60 days), the longer ones are usually more expensive. You can get a longer period for your lock, but in making this choice, will probably have a higher rate than you would have with a shorter span of time
Additional Ways to Save on Interest
In addition to going with the shorter rate lock period, there are several ways you can get the best rate. A larger down payment will result in a lower interest rate, because you will have a good deal of equity from the beginning. You could choose to pay points to lower your rate for the loan term, meaning you pay more initially. To many people, this makes sense and is a good deal..
At Contemporary Mortgage Services, Inc, we answer questions about this process every day. Give us a call at 407-834-3377.
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