What is a "rate lock period"?
Lock It In
A rate "lock" or "commitment" is a lender's promise to set a specific interest rate and a particular number of points for you for a specified period of time while your application is processed. This protects you from getting through your entire application process and discovering at the end that the interest rate has gone up.
Although there may be a choice of rate lock periods (from 15 to 60 days), the extended ones are typically more expensive. You can get a longer period for your lock, but in doing so, will most likely have a higher rate than you would with a shorter rate lock span of time
Other Interest Saving Strategies
In addition to choosing the shorter lock period, there are several ways you are able to attain the best rate. A larger down payment will give you a reduced interest rate, since you'll be starting out with a good deal of equity. You may choose to pay points to reduce your rate for the life of the loan, meaning you pay more up front. One strategy that is a good option for many people is to pay points to bring the rate down over the life of the loan. You'll pay more initially, but you will come out ahead in the end.
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