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

Lock It In

A rate "lock" or "commitment" is a lender's promise to lock in a specific interest rate and a particular number of points for you for a specified period while your application is processed. This ensures that your interest rate will not go up during the application process.

Although there are several lengths 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 making this choice, will most likely have a higher interest rate than you would have with a shorter span of time

Other Interest Saving Strategies

In addition to opting for a shorter rate lock period, there are other ways you may be able to score the best rate. A bigger down payment will result in a better interest rate, since you're starting out with more equity. You can pay points to reduce your rate over the loan term, meaning you pay more initially. One strategy that is a good option for some is to pay points to improve the interest rate over the term of the loan. You'll pay more initially, but you will come out ahead in the end.

Net Equity Financial Mortgage can walk you through the pitfalls of getting a mortgage. Call us: (215)741-3131.

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