What is a "rate lock period"?
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Lock It In
When you are offered a "rate lock" from your lender, it means that you are guaranteed to get a specific interest rate for a determined period for the application process. This ensures that your interest rate won't grow as you are going through the application process.
While there are several lengths of rate lock periods (from 15 to 60 days), the longer spans are generally more expensive. A lender will agree to hold an interest rate and points for a longer span of time, like sixty days, but in exchange, the rate (and sometimes points) will be more than that of a rate lock of a shorter period.
More Ways to Get a Great Interest Rate
In addition to opting for a shorter lock period, there are other ways you may be able to attain the best rate. A larger down payment will get you a reduced interest rate, since you're starting out with more equity. You could choose to pay points to bring down your interest rate for the life of the loan, meaning you pay more initially. One strategy that makes financial sense for some is to pay points to reduce the interest rate over the term of the loan. You are paying more up front, but you will save money in the long run.
Pinnacle Lending Group, Inc. can walk you through the pitfalls of getting a mortgage. Give us a call: (702) 730-2085.