What is a "rate lock period"?

Locking in your Interest Rate

A rate "lock" or "commitment" is a promise from the lender to lock in a certain interest rate and a particular number of points for you for a certain period while your application is processed. This prevents you from getting through your whole application process and discovering at the end that the interest rate has risen higher.

While there are several lengths of rate lock periods (from 15 to 60 days), the extended spans are generally more expensive. You can get a longer period for your lock, but in doing so, will probably have a higher interest rate than you would with a shorter span of time

More Ways to Get a Great Interest Rate

In addition to opting for the shorter lock period, there are several ways you can get the lowest rate. The bigger the down payment, the lower your rate will be, as you will have more equity from the beginning. You could opt to pay points to bring down your rate for the loan term, meaning you pay more initially. One strategy that makes financial sense for many people is to pay points to bring the rate down over the life of the loan. You will pay more up front, but you will save money, especially if you don't refinance early.

Pioneer Mortgage Corp can walk you through the pitfalls of getting a mortgage. Give us a call at 7812454924.