"Rate Lock" and other Ways to Get a Lower Interest Rate

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 over a determined period while you work on the application process. This means your interest rate cannot get higher during the application process.

While there can 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 choosing this option, will most likely have a higher interest rate than you would with a shorter rate lock period

More Ways to Get a Great Interest Rate

In addition to going with the shorter lock period, there are several ways you may be able to score the best rate. The more the down payment, the smaller the rate will be, as you will be starting with more equity. You can pay points to reduce your rate over the life of the loan, meaning you pay more initially. One strategy that is a good option for many people is to pay points to reduce the rate over the term of the loan. You'll pay more up front, but you will come out ahead, especially if you keep the loan for the full term.

At 1st Credential Mortgage Inc, we answer questions about this process every day. Give us a call at (281) 778-0805.