What is a "rate lock period"?
What is a Rate Lock?
When you are offered a "rate lock" from your lender, it means that you are guaranteed to keep a specific interest rate over a certain number of days for your application process. This ensures that your interest rate won't rise as you are working through the application process.
Rate lock periods can vary in length, between 15 to 60 days, with the longer period generally costing more. You can get a longer period for your lock, but in making this choice, will most likely have a higher rate than you would have with a shorter period
More Ways to Get a Great Interest Rate
There are other ways to get a reduced rate, besides going with a shorter rate lock period. The bigger down payment you make, the lower the rate will be, because you will have more equity from the start. You could choose to pay points to lower your interest rate for the loan term, meaning you pay more up front. One strategy that is a good option for some is to pay points to reduce the interest rate over the life of the loan. You'll pay more initially, but you will save money in the end.
Carter Financial Solutions can answer questions about rate lock periods & many others. Give us a call at 866-840-8745 x2.